When you have a family, the plan is to settle down and build a life. However, there is only so long a family can last on one property. On average, a person moves eight times in their lifetime, which means you will be on the lookout for a new home. Like all things of value, the property market changes like the weather. So, the factors you had to take into consideration the last time you bought are no longer an issue. Instead, there are different features to address now and in the future. Should you not think about the short, medium and long-term, the investment could be a dud.
The thing is it’s not easy to know when to buy and when to bide your time. In fact, it’s almost impossible because there will always be one thing holding you back. To help yourself, it’s essential to ensure there are specific attributes in place. Hopefully, the following will be of assistance in picking out a new home.
Back in 2010, the banks went into freefall and the entire world suffered as a result. Fast forward 7 years and the economy still hasn’t fully recovered. Sure, demand and supply are rising, but house prices are at an all-time high and buyers have mountains of debt. One thing the crash taught all homeowners is that the banks are not to be trusted, even if it looks as if they are on your side. They use jargon, talk in riddles, and hold back the truth to tie average working people into bad deals. So, the sentence “you’d have no trouble getting a mortgage” means nothing unless it’s on paper. Thankfully, a pre-approval is in black and white and states they will accept your loan application.
A deposit has always been a requirement yet the amount has fluctuated over the years. Nowadays, lenders want as much as 10% as a deposit before they release the rest of the funds. The deposit may lower the monthly payments but most people don’t have the money lying under their mattresses. And, that is the crux of the issue because property prices are getting bigger and bigger. A couple looking to buy for the first time in London, for example, may have to spend $150,000 on a one-bedroom flat. That equates to $15,000 down payment! There isn’t much you can do but wait and save; however, don’t assume the worst. Some lenders have schemes which allow them to accept around 5% of the value of the house. Do your due diligence and shop around for an excellent deal.
Depending on when you last bought a house, the expenses may have been few and far between. Not any longer because there are costs which range from paying the realtor to property taxes. There is even an architecture expense because he or she has to check the home for structural problems. The additional costs mean the overall price of the property will increase from making an offer to closing. In some cases, it can total almost $5,000 more, which is a lot of money. As a rule, a 1% to 2% contingency plan is a wise move. That way, the budget should cover everything, even the costs which pop up out of the blue. The more you can save the better because there is also renovation and maintenance costs to consider when you get the keys.
No, this is not the person you plan to spend the rest of your life with. In this case, it’s a partner in crime who will help you find a fantastic deal on the house. Normally, they are realtors with an extensive knowledge of the market and the local area. Of course, using an industry professional is nothing new, not to find a property and make an offer. However, current estate agents do so much more in the 21st-century than their 20th-century counterparts. Today, it isn’t uncommon for one to provide a contact regarding the mortgage. In fact, a high percentage of buyers use their realtor’s recommendation to obtain a loan. Of course, you have to be careful because both parties could be running a scam. But, if they are trustworthy people whose backgrounds check out, it could be a savvy business decision.
A contemporary attitude focuses on more than the aesthetics of the property. There is no doubt they are important because no one wants to live in a dump. Still, other factors are just as vital for a modern family with two working parents. Take the schools in the area as examples. Not only do they need to be high quality, but they need to be close by for commuting purposes. It’s far easier for a mom or dad to drop their kids off at school if it is nearby or on the way to work. Also, a long commute time leads to stress and unhappiness. So, completing the drive or train journey beforehand is essential. Can you handle it or is it too long? It’s best to find answers previous to committing to a long-term contract.
A family is a vague term which encompasses a wide range of people. There may be moms, dads and kids, but their ages and life prospects are different. A young family is a settled group because the kids are still in school and the bills come thick and fast. An older family, on the other hand, is probably looking to make significant changes. For instance, the kids may be moving out and going to college. Or, they may want their independence and their own place. When this happens, buying a mansion with fifteen bedrooms is a terrible idea because it’s too big and a waste of money. Downsizing means finding a smaller home or an affordable bungalow and cutting back for the sake of your sanity and finances. Of course, the opposite applies to families with babies who are looking to expand. Then, bigger is better.
Getting the right balance is difficult regarding property viewings. Usually, buyers would view as many as possible to get a gist of the market. Plus, the more you see, the more extensive the research becomes. Sadly, looking at too many properties can be unwise thanks to the available houses on the market. Frankly, there aren’t enough quality ones to go around. So, putting a home you love on the backburner may result in missing out on the house which was head and shoulders above the rest. To negate this issue, you can speak to the agent to discuss the popularity. Typically, they’ll say it will sell quick but take them to one side and ask for bluntness. Other than that, it’s best to strike while the iron is hot, providing the property has all the amenities on your list. In truth, only you and your partner will know when the time is right to make an offer. Anyway, it takes time to hear back from the seller so you get time to view additional houses while the proposal gets processed.
Don’t forget that selling your current property may be the key to buying a new one. The odds are high that you don’t have the funds until the sale goes through. Unfortunately, a quick transaction is never smooth in 2017 because house prices are high and buyers are careful. There are ways to spruce up a home to make it more appealing, and some of them are effective. However, no hack works better than putting the property on the market as early as possible. Even if you haven’t looked at alternatives yet, it’s best to get ahead of the curve. The reason is simple: it gives a seller more time to find a buyer. Nowadays, people don’t pop up out of the blue and make a cash offer. In reality, potential candidates view the property two or three times and begin a steady round of negotiations. Also, it can take a long while for a bank to release funds and rubber stamp the paperwork.
Stay Or Go?
The most important question every buyer wants to know is, “is this the best time?” Now, there are indicators to watch out for such as the state of the market and ease of access regarding a mortgage. In truth, no one should take out a loan which is too strict or that has the potential to go under in the future. However, trying to wait for the perfect date is counterproductive. The factors to consider are simple: the pre-approval letter, the money and your circumstances. Anything else is worth factoring into your decision but shouldn’t prevent making an offer. So, do you have these three things ready to go? Good, because that means the time is right!
But remember that as the market evolves, so should the buyer.
Site last updated: 14. February 2019