Buying a house is a significant undertaking. Such a principal transaction is only if you purchase property to rent it then out. If you are making a deal to buy a house to live in, you should solely think of it as an expense.
But there are many benefits to buying a house:
- If you are determined to stay in this place forever, the house will be more comfortable than the apartment;
- For families with children, having a large home and spacious backyard is almost a must;
- A large and beautiful home will reflect your image and high status.
If these advantages outweigh the benefits for you, it's time to think about how to conclude a good deal correctly. There are all new construction developments at your service. It remains only to choose the best option. Want to know the smart way to buy a house? Then keep reading this guide.
What to consider?
Is now a good time to buy a house?
Real estate prices are continually changing. If a buyer is considering taking out a mortgage loan, there are several factors to consider:
- Banks are currently offering meager interest rates, which are expected to remain at this level over the next year;
- The cost of new houses by the end of the year will gradually increase by about 5%;
- Banks offer mortgages for 15 or 30 years (in the second case, clients significantly overpay, but not all have the opportunity to repay the loan twice as fast).
Also, buyers should think about the financial burden on the loan and other needs. Banks also take this factor into account, so they may refuse if the client, for example, does not have enough money for the first installment (20-25% minimum).
Determine How Much House You Can Afford
To prevent the home from becoming your number one problem, you must carefully calculate all costs. The fact is that the mortgage payment is far from the amount you have to spend every month. In some states, real estate taxes go up to two thousand dollars a month. What's more, when you rent a home, you don't have to worry about roofing or air conditioning repairs. When you are a homeowner, this burden is on your shoulders. The optimal financial responsibility, including all housing costs, is 25-30% of your monthly income. This amount should include:
- Payment of taxes;
- Payment of interest on a mortgage loan;
- Payment of utility services.
Think it through
To get a mortgage, the client must have a credit rating of at least 760. If your score is not so high, but still good, a small personal loan or even two may help you. If you take them and pay them off on time, your rating will increase. Communicate more with realtors and study the real estate market on your own. If the previous owners ask for an amount higher than the market average for the house, they may also refuse to loan you.
Always work with more than one realtor. This way, you can see more houses and appreciate the benefits of different areas. Also, each specialist pays more attention to those details that seem important to him. The buyer needs to find a realtor with the most similar views on real estate.
Do not be too categorical when evaluating houses. If you don't like only one item out of a hundred, and everything else is fine, think about whether it is so important. Sometimes the homeowner allows the house to be rebuilt at the discretion of the new owner. In this case, think about your comfort and that you may want to sell this property in the future. If, in the selected area, swimming pools are not popular among residents, you will most likely not be able to recoup your costs for building a lake in the yard.