Buying property is a big deal – and requires a lot of decision-making!
Although it may seem rather simple and easy at first, many factors go into making home-buying choices that will satisfy you in the long term, not just the short term.
Some of these are probably obvious, but others are more subtle or not top-of-mind. Let’s take a look.
Location, style, size, price range
Questions of location or where you want to live, price range you can afford, size and style of house are usually the first and most typical things you sort out as you begin the house buying adventure.
Answers might seem obvious initially. For example after working with a loan officer, you will know the limits of what price range is possible for you. Or maybe you know you need to live in a certain proximity to your job which limits your locational choices.
But even with heavy constraints, there are situations and choices you may need to consider. The more thinking and planning you do early on, the better decisions you will be able to make.
Choosing a house
No matter how sure you are about what you want in a house, you still have to find something to match those desires. As you look at houses, you begin to see that you might not find exactly what you want and so you start re-evaluating some things. You will need to determine your biggest priorities and give up some less important ideas, as discussed in another blog post. (Read it here.)
In any case – think about these next questions – especially if you find a house that you think might work for you:
How much work do you want to do – or might you be able to do – on the house to make it really what you want? What might that cost?
Could you actually find a house for a similar price but where those remodeling upgrades would not be necessary for you?
If houses that need no work are too expensive for you, are you in a position to afford the changes you want in the house you are buying? If not, can you live with the house as it is?
Determine if there are any issues or downsides to this house. Are there possible problems you will inherit? Examples: the house is in a floodplain, or it is not in the school district you eventually would want your children in.
Winning the house
To win the house, you need to make an offer that gets accepted. How should you judge the price the house? Is the listed asking price on target? Or is it too high? Or rather low?
Your broker/agent can provide a good CMA (Comparative Market Analysis) that will show the prices of similar houses in the area. This helps you evaluate the going value, which should factor in to your offer price.
If the listing price is high, you can make an offer for less than asking and still get a response. The seller might then counter-offer with a price higher than your offer but lower than listing.
If the house is priced low (compared to its market) – expect that others will want the house also. In this case you may want to offer more than asking to stand out.
Something else to think about: Do you have any contingencies (like need to sell something in order to finance this new purchase)?
If you do, that might your offer less attractive than some others. To be competitive with non-contingent offers, you might offer a higher price than you think others might.
All of these things factor into the strategy you might use in order to get your offer accepted.
Questions?
Once again – your broker can help you figure these things out. Do not be shy about asking help in fully understanding your options and strategies.
Contact us – we would love to help you understand more!