Buying your dream home can be a lot of fun, but don’t be too quick to fall in love with a home before doing your due diligence! There are several factors you need to take into account before you dive into an investment this large. Make sure you consider the following questions before you decide to put in an offer on a home:
Can you really afford it?
When you find a home that you love, look beyond the list price when calculating how it will factor into your monthly budget. There are other expenses that when combined can cause you to be “house poor.” These can include insurance, taxes, HOA fees, utilities, maintenance, and more. Becoming house poor means that you’ll be spending so much on payments related to your house that you end up having trouble paying for other things. Choose a house that you’ll be able to afford, not necessarily what you’ve been approved for.
Do you plan on living in the home for a long time?
Some of us can safely say that our future living situation is up in the air. Depending on your job and how long you plan on staying in that position, you may want to reconsider purchasing a home. Likewise, if the probability is high that you could be relocated, or if you’re in the military, you also should seriously consider the consequences of moving soon after you buy. You may need to have savings built just in case you need to sell your home and it doesn’t sell fast enough. In that case, you may be paying for two homes. Even if all signs in the market point to a great time to buy, it may not be the best time for you personally.
Is it really move-in ready?
Make sure you carefully read the listing descriptions while you’re house hunting. Terms like “recently refurbished,” “renovated,” or “restored” are good signs that a house is pretty close to move-in ready, while terms like “fixer-upper” may be red flags. Decide what move-in ready means to you, and stick to that as you search. Don’t agree to take on several DIY projects that you’re not prepared to handle just for the sake of getting a specific house. Even if they are fixes that you consider easy, there is always risk that a project will turn into a home improvement fail. Have the owners provide all the documentation they can on repairs and maintenance, and make sure you hire an inspector and pay attention to the inspection report.
Is the neighborhood and surrounding area safe?
Before you buy, chat with some of the neighbors and get a feel for life in the neighborhood. Are there neighborhood events? Is there a neighborhood watch and regular meetings? Do the neighbors seem friendly or keep to themselves? All of this and more may matter greatly to you, so try to get those answers before you buy. Also, it wouldn’t hurt to explore the area at night. Make sure you’re comfortable with the surroundings when the sun goes down. You want to be sure that your potential neighborhood feels safe at any time of day!
If you’re considering a move to a new city, make sure you absolutely love the new location before you fall in love with the neighborhood. Make sure there is access to any activities you love, and keep school districts in mind if you have children. Ask about traffic and anything else that will play a major role in your daily life.
Be sure to pump the brakes a little bit when you think you’ve found your dream home! Consider all of these questions and work with a team of mortgage and real estate professionals before you make an offer. After careful consideration, if your list of pros outweighs the cons, then you'll feel great about making the decision to become a happy homeowner!