It starts innocently enough… you pass a house in a neighborhood you like; you hear someone is selling their home, and you happen to look up home prices online. Before you know it, you’re knee-deep in home shopping and open-house visits. This off-the-cuff approach can be exceedingly dangerous to your financial future.
Falling in love with a home before you know what you want in a house is risky. To avoid the “buy first, think later” syndrome that burdens family finances, marriages, and work life, ask yourself these critical questions:
1. How much do you want to spend monthly on home expenses? There’s a tendency for people who shop first to try and “make the math work” on purchasing a home. This approach often stretches the home budget and ignores crucial expenses such as maintenance and property taxes to “make the mortgage.” Determine a comfortable, conservative range for home expenses first.
2. Which neighborhoods make sense from multiple angles? You may love a neighborhood for its leafy streets and family-friendly atmosphere, but what if it adds thirty minutes to your commute? Are the schools good? What are the crime stats like? What’s the walkability score? Don’t view a neighborhood with rose-colored glasses based on a single quality you like.
3. What’s a priority, and what’s a nice extra? You may want extra bedrooms for guests and a home office, but which one is more important? Rank the “must-haves” against the “nice to haves.”
4. What does our long-term ownership picture look like? Are you settling in and planning on staying in the home for ten years, or do you suspect you’ll need to move in four? While you can’t predict the future, you can make some estimates. Those estimates will help you understand how much home you should buy, what kind of down payment you’ll want to have, and what the picture might look like regarding renovations.
5. When can you move vs. when would you like to move? Rental leases, selling your current home, and job and schooling factors all impact the timeline for a purchase. Wrap your head around the pragmatic timeline as best you can.
I’m more than happy to help you think these through. Contact me for help today: Liz Norvelle (928) 458-4025