Buying a home is one of the largest investment decisions many people make. But how do you know if buying a home is right for you?
There are many factors that weigh in on making a final decision and that's why it's important to do some research to see if being a homeowner is the best decision for you, your family, and your goals.
Important Home Buying Decisions
Deciding where you'll live and exactly which home you'll buy is an important choice that will affect you for many years to come. To be confident in your choice and feel good about the home you're thinking of buying, you should do your homework to make sure you're buying a home that's affordable based on your finances. It’s also important to secure financing with fair terms from a trusted lender.
Here are seven steps to help you make the best decisions when it comes to buying a home and realizing your dream of homeownership.
7 Factors to Consider Before Buying a Home
When trying to decide if buying a home is the right move for you, here are seven things to think about so you can make the best home buying decision.
1. Financial Preparedness
Are you able to afford a home purchase? Being prepared for homeownership includes the ability to be approved for a mortgage. This includes factors such as a down payment, money for closing costs, affordable mortgage payments, and a good credit history to secure the financing.
2. Location, Location, Location
Besides securing financing, the location of your new home may be the next most important part of the home-buying process. Assuming you've already decided the city and state in which you want to live, choosing an area or community is crucial. It may be helpful to make a list of your top five priorities that include things like work commute, schools, entertainment options, location of friends and family, etc. Once you know what you need in a home location, you'll be able to narrow it down to the neighborhoods that best fit your unique situation.
3. Home Size and Layout
Choosing the size and layout of your home is important to ensure you have enough space, both now and in the future. It also ensures that the layout works well with your lifestyle and accommodates everyone who lives in the home. Think about future plans when choosing the size and floor plan of your home to ensure it will work if your family grows over the years or if you desire certain living spaces for your daily activities.
4. Condition and Inspection
What type of home are you looking for? A turn-key home with little to no upgrades or a fixer-upper that needs work to make it your own? Both are popular choices for homebuyers and either way they should have a professional inspection performed to determine the condition of the home before you commit to buying it so you know exactly what to expect.
5. Homeowners Association (HOA) and Covenants
Buying a home in a community that has an HOA and covenants takes some research and consideration, as there are pros and cons associated with the management of your community. The good thing is that you're most likely assured that your community's appearance and upkeep will be held to a certain standard. The downside is that these rules may interfere with your ideas for your home. In addition, make it a point to clearly understand the fees associated with the HOA and everything that is your responsibility.
6. Resale Value and Market Trends
One of the most important things to consider when buying a house is the local real estate market and how it will affect your resale value. The current state of the market in your area is a huge factor when considering homeownership. Are there available homes in your market at the right price and location? Is it more affordable to own than rent in your area? What are the current interest rates, and how are they trending? Is the area popular enough to see home prices increase over the years? These are all important questions to consider.
7. Emotional Factors and Future Plans
Don't underestimate your emotional state when buying a home. You may find it overwhelming to be facing such a huge commitment…and that’s ok. Analyze your current lifestyle as well as your future plans when considering homeownership. Things change when you own a home vs. renting, and you need to be sure that the additional responsibilities that come along with homeownership fit your present and future goals.
Understanding these seven factors before buying a home is a savvy move by potential homebuyers. Educating yourself is a great way to ensure you're prepared and better understand the best time for you to consider homeownership.
If you've decided that buying a home is the right decision for you and are ready to get started, we offer a complete suite of mortgage products to fit your life. Our Mortgage Services Department is ready to help. Contact us today or get pre-approved online. As always, if you have questions please feel free to contact us!