The prospect and process of finding your dream home is exhilarating, but it is at this stage that you should take a step back and ask yourself a series of important questions. This will help you gauge whether you’re ready for such a significant investment.
New homebuyers should consider everything, ranging from a detailed budget of exactly what they can afford to thinking about the long-term implications that buying a home might have. By taking certain steps to assure your readiness to buy a home, it not only shows you exactly what you want and need, but also ensures that you’ll be stable and secure in the future.
Here are a few things every potential homebuyer should think about:
Do I Know My Budget?
When buying a home, your budget should include more than just what you’re willing to pay for the total list price or monthly mortgage. Rather, homebuyers should take into account the lesser-considered factors such as potential association fees or Mello Roos, any upgrades or renovations that the property needs, or homeowner’s insurance quotes that are required to complete the transaction.
Keeping track of any extra costs and expenses that go into buying a new home will prepare you against any unknown fees and payments, so you know exactly how much you’re paying every month.
What City or Neighborhood Do I Want to Live In?
This one is absolutely crucial, especially since buying a home is generally a long-term investment. Knowing the specific location you want to buy a home in is necessary, but understanding why you’d want to live there is even more important. Crucial factors that often determine why buyers move to specific cities include proximity to their workplace, quality of education, crime and safety rankings.
Making sure to look into the neighborhoods within each city is also crucial, as it will give you a better understanding of the quality of life and community that exists in each one.
How Big of a House Do I Need?
Be completely honest with yourself on this one. Without a doubt, everyone wants to own an enormous home, but understanding the difference between your needs and wants can save you big in the long run. According to Realtor, the price per square foot when building a single-family home was $103 in 2015. The costs associated with extra space can add up quickly.
Consider this: Buying a property that is unnecessarily and excessively large can cost you a great deal on monthly bills. Bigger homes require more energy usage, household maintenance, and other needs that will leave you with staggering utilities expenses.
Are My Financial and Employment Situations Stable?
Although this one is usually a given, new homebuyers should be careful to take a detailed look at whether their position in life affords the stability to purchase a home. As is the case with the previous question, you should be completely honest with yourself here. Make sure your job is not only stable for the next couple years, but that the industry is one you see yourself in for decades to come. Keeping this at the forefront lets buyers take a bigger-picture view at their circumstances, and helps identify if now is the right time to buy.
Do I See Myself Living Here for Five or More Years?
Just as is the case with other investments, considering the future can keep you from rushing into any hasty mistakes. Generally, most people live in their purchased homes for anywhere from seven to 13 years, and so a long-term perspective is vital to a positive and prosperous investment.
Whether in terms of job opportunities, raising a family, size of the home, or anything in between, potential buyers should keep in mind that they may live in the home for about a decade, and so it should provide them the flexibility and stability they need for any future plans.
Thus, we can see that home buying is more than just determining your monthly budget, what city you may want to live in, or other general factors. Although these are important factors to consider, homebuyers should always dig deeper to make sure their investment is the right one. By keeping the above questions in mind, you can keep track of the various considerations that arise when buying a home, which will help guide you in making the best decision.