So you’ve decided that 2021 is the year to buy a house. Maybe this isn’t the first time you’ve bought a house, or maybe you’ve done this before. Either way, there are some tips to follow to be smart when starting the process for this major purchase, to ensure that you are successful and land the home of your dreams. Here are some factors to consider:
Know your must-haves
You probably want to buy a house because your current house isn’t meeting your needs, either budget-wise or when it comes to space. But you need a plan to get there, firstly, because there are many options out there, and secondly, because there is a lot of competition when it comes to buying. Before you start your search, make an honest assessment of what you really need in your next house. Maybe it’s a second bathroom, or space for a home office, or a homework and study area for the kids? Maybe it’s your dream to have a backyard to host parties and give the kids and pets somewhere to run free. Whatever your dreams, make a list of them and be honest about what your ideal home looks like.
Have a realistic budget
Part of visualizing your dream home is also being honest about your budget. While you might fantasize about having a pool or spa in the backyard, can you really afford it? Knowing the maximum amount that you can spend on a house will help you target those homes that are really within your reach. If you are selling a home to buy a new one, you can use the Net Proceeds calculator from HomeLight to see how much home you can afford. In today’s market, it’s also important to be aware that you might end up needing to pay a bit over the asking price to compete with other buyers who might also be vying for your dream home.
Study the market
When it comes to finances, understanding the market in your targeted area (and how it might be changing) can help you create a realistic budget. A real estate agent can advise you, but before you even hire an agent, you can check out a site like Zillow, which is constantly pulling data on housing market prices, so you can see how they are changing in your neighborhood.
Hire an expert
If you hire a real estate agent, they will be your best advocate to help you land that dream home. Your goal should be to hire a professional who has experience working in your targeted city and neighborhood so they’ll know about market fluctuations and can quickly advise you when they see a home that might fit your parameters.
Understand the realities of bidding wars
In today’s real estate market, it’s likely that you won’t be the only one who wants to move into that perfect home with two bedrooms, two and a half bathrooms, a home office, and an expansive backyard. That’s because in United States cities, there are not enough homes to keep up with demand. That means homes are selling for over the asking price with buyers competing to outbid each other. Your agent can advise you about how much extra you might expect to pay in your targeted market, so you can modify your budget accordingly.
One reality of buying a house is that it is likely going to take longer than you think. If you start the process knowing this you will be more relaxed and will be able to take any delays in stride. Unless there is some pressing reason why you need to buy a home as soon as possible, trusting that you’ll find that dream home, even if it takes a little longer than you thought, will keep you from becoming frustrated and losing sight of your goal.