If you are thinking of buying a home, these 10 recommendations can help you make the best decision.
After years of economic crisis, signs have already begun to emerge that the housing sector is stabilizing. Many experts say that it is the right time to invest in a property, but caution is advised.
Other analysts believe that prices may continue to fall. According to the economist and professor at Yale University, Robert Shiller, famous for predicting the real estate crisis, the sector still has not recovered.
In an article published by The Wall Street Journal, Shiller mentions the high level of foreclosures and high unemployment as factors that impede the recovery of prices.
So, our best 10 tips are:
- Make yourself a financial self-assessment. Before buying, it is important to analyze your financial situation. The most important thing is to determine our income and the capital that we have available as a downpayment. Although loan interest rates are currently low, obtaining a mortgage is difficult. Banks are increasingly demanding in the verification of their income and credit history.
- Set realistic expectations. If you are buying your first home it is important that your expectations are realistic regarding the increase in the value of the property.
- Think like an investor. Think about the expected return on your investment, the risk, and the term. The profitability if you buy to lease the property will be what you get from the rental income, less the maintenance costs and taxes. Together with the annual valuation of the property, this becomes its profitability.
If you buy a property to live in, one of your goals will also be to make the best possible investment. The best way to achieve this is by looking for the areas with the best schools because those areas tend to be poles of attraction for families.
- Consider continuing to pay rent. Compare the costs of buying and maintaining a house with the cost of renting it.
Darrell Godfrey can help you bring every element of managing your greatest asset into place. He can help you with buying a new home, financing and insurance questions
- Location, Location, Location. A house gains in value if it is located in an area with high-quality schools and with good communication and transportation routes to the main urban centers.
- Become an expert. Gather information about the area you chose and the properties that interest you. It is important to know at what price homes similar to the ones you want were recently sold.
- Look for pre-approval of credit. When seeking approval from a bank, the buyer will know your credit rating and the interest rate at which you would get a mortgage. “It is very important that you look for many options from different banks to make a better decision,” says Ilyce Glink, personal finance expert and book author on home buying.
- The house can be a retirement plan. Changing houses can pay dividends. “It is an increasingly common strategy among people who are approaching retirement age or are retired.
- Consider the improvements. Calculate the cost of the additional investment required by the home. No property is perfect and even the new ones require changes and modifications. It is key that the changes made are aimed at increasing their value.
- Think long term. The purchase of a home is a long-term investment. It is recommended to buy with the prospect of keeping it for five years or more. This time allows you to obtain greater benefits from having a property if you live in it or if it was purchased as an investment to rent.
If you need more tips or professional advice on property buying, don’t hesitate to contact Home Buyer’s Services of America