5 Things To Think About When Buying A New Home
Buying a new home is one of the greatest investments you will make in your lifetime. It will be where many memories are made. It’s not a simple process – so make sure you have someone knowledgeable to help you understand everything from down payments, locations, escrow, interest and more.
Here are some statistics about home buyers from Zillow’s Consumer Housing Trends Report:
- Today’s buyer spends nearly four and a half months, on average, looking for a home they will share with some combination of a spouse, a partner, children, parents, roommates, tenants and pets.
- Just over half (52 percent) of buyers put down less than 20 percent on their home.
- Today’s typical American home buyer is a 41-year-old, college-educated couple with an annual median household income of $72,500 and aspirations for single-family living.
- More than half (64 percent) of homeowners view their home as a financial investment.
Your home is a significant investment but there are some things you may not think about.
Here is a list of 5 things to think about when buying a new home.
Think about potential developments:
Understand the area of your prospective home. Is it near a busy road or will they be adding a road near your home that will increase traffic? Is the area still growing? Will they add more houses or even commercial offices? The future value of your home depends on the location, amenities, and possible traffic surrounding the home.
Research The Neighborhood HOA:
If you are moving into a neighborhood, there is a good chance that there will be an HOA (Home Owners Association). They make the rules to keep the neighborhood’s home values. They have many restrictions and rules you need to follow, or you will get fined. They control things like fencing and fence height, sheds, parking on the road, etc. They may even make you submit design plans if you want to add a deck, a swing set, or even change up the landscaping in your yard.
Shop Around for Mortgage Rates:
You have many options when it comes to financing your home. Speak to a professional who can help you understand how your mortgage payment will be calculated so you don’t end up with an outrageous payment in a few years.
If you are building your home, the builder may offer an incentive like 1% of the loan to go towards closing cost when you use their preferred lender. Do the math to make sure the interest rate isn’t much higher than another lender. It may cost you a lot more than what they are offering you in the long run.
You can buy a new home without a 20% Down Payment:
Many people pay more to rent a home than the cost of a mortgage every month because they think they need to put down 20% in order to qualify for a mortgage. Some loans require $0 down payment and others are as low as 3-5% down payment.
Speak to a mortgage broker to find out what options are available to you. You can also get pre-qualified to know how much you can afford. You don’t have to spend that much on a new home – know what you can afford. But in the long run, you could be paying less and investing your dollars into your home.
The downside is that when you don’t put down 20% you are typically subject to mortgage insurance payments which can add to monthly housing costs.
Things Will Break, So Be Prepared:
Appliance only last so long. If you are buying a house that is a few years old, you will need to budget for repair bills. A HomeMembership home warranty can help lessen the burden of these stressful and expensive repairs.
When you have a HomeMembership plan, you contact them, and they find you someone reliable to come to take care of the repair as soon as possible. All you have to pay is the $75 deductible. Or, if you have your home and auto insurance through HomeMembership your deductible would be $0!
HomeMembership will repair things like your furnace, waterline repair, AC Unit, Plumbing Repairs, and most appliances in your kitchen!
Owning a home is a great investment – just be prepared. All this information can help get you started to find and enjoy the home of your dreams!