By Erik Braunitzer, and compliments of Douglas Elliman Real Estate (PDE), agents for Hamptons Homes.
A home is the biggest purchase that most people will ever make. In today’s challenging economy, it is important for consumers to make every dollar count. These principles will help you make a wise purchasing decision, and keep you from experiencing buyer’s remorse after you sign the dotted line to purchase your new home.
Consider Your Long Term Plans
In this down economy, it is definitely a buyer’s market. Potential homebuyers can be enticed by decreasing home prices and phenomenal interest rates. However, you need to take a careful look at your current financial situation and your future goals before you purchase a home. A house is not guaranteed to be a good investment, and it could be at least five years before you build considerable equity.
For instance, think carefully about your job stability. If you are unhappy at your current position, it might not be the best time to buy a home. If others at your company have been asked to relocate, then it could happen to you as well. You should also avoid purchasing a home if you or your partner desire to live in a different area.
Less Is More
It can be tempting to purchase a big, beautiful home with a host of amenities. However, you can protect your financial stability by buying a smaller home at a lower cost. A lower mortgage payment will also allow you to continue with your previous quality of life.
If you have any wiggle room in your budget, then make more than the minimum payments on your mortgage. This allows you to build equity more quickly. A lower loan balance will also allow you to sell your home more easily if your life situation changes. Balance is the key, so do not buy a house that is too small just to save money. If you and your family are overly cramped, you will not be able to enjoy your new home.
Research the Location
You can change a lot of things about a house, but you can never change its location. Before you purchase your home, research the crime rate for the neighborhood. You should also drive through the neighborhood at various times during the day, especially after dark. If you do not feel safe in the neighborhood, then cross that home off of your list.
You should also proceed with caution if the neighborhood has over half of its properties for sale. Values in this type of neighborhood will likely decrease further before they increase.
Protect Your Investment
You will likely sell your home at some point, so it is vital to properly maintain your home once you purchase it. Routine maintenance will help you to avoid larger problems. An attractive, modern home will sell much more quickly than a dated one, especially in a competitive real estate market.
Buying a house can be scary, but you can avoid buyer’s remorse by planning carefully, staying within your budget, investigating the location and caring for your new home.
