Finding your dream home can feel like looking for a needle in a haystack. Keep in mind these essential tips when searching for the perfect fit.
Set Your Budget Before Starting Your Home Search
Setting a price range is crucial because your budget can help narrow down your search. A great way to figure out your budget is to get pre-qualified by a mortgage lender. Pre-qualification is a quick and easy way to have a mortgage professional assess your financial situation and give you a rough estimate of what you can afford.
Pre-qualification is a great first step, but you will also need to get pre-approved for a home mortgage. Pre-approval is more in-depth. You will need to provide documents and records having to do with your debt, income, and credit history. A mortgage professional and underwriter will use these documents to verify your eligibility for a home loan.
Once you get pre-approved, the lender will give you a pre-approved loan amount, which tells you how much you can afford. In short, pre-qualification is an easy way to get an estimated budget, while pre-approval gives you a more exact maximum loan amount. Remember, your pre-approved loan amount is the ceiling, so you should focus your search on homes that cost less than your maximum loan amount.
Consider The Location
Location! Location! Lo-… you know the rest. Cliche as it sounds, this age-old saying is around for a reason! You should think long and hard about the location of your new home.
Some questions to consider:
- Do you want to live in a place where you can easily walk to nearby shops and restaurants?
- Do you want to belong to a more close-knit community?
- Or, are you looking for a more private space located off the beaten path?
- How safe is the neighborhood? What are the local crime statistics?
- How easily can you commute to work or school?
- Is this in your preferred school district?
- Do you want to live close to family and friends?
A great way to figure out what location you’re looking for is to think about where you currently live. What do you wish was different about the location you’re in now?
Think About What Features Are Important To You
When deciding on the features that matter most to you, make sure to plan for the future. For example, if you want to expand your family, you’ll eventually need more space.
Also consider what lifestyle amenities are crucial to you. Maybe you love to garden, so you’ll want a big enough yard that allows room for your favorite hobby.
Similar to how you should think about your current location, you should also ask yourself about your current living situation. What do you wish was different? What features are you missing out on now that you’d like to have in your new home? For instance, do you love to bake and want a larger kitchen?
Some house features to think about:
- Size and square footage
- Air conditioning
- Number of bathrooms/bedrooms
- Outdoor space
- Floor plan and layout that meets your needs
- Natural light
- Storage space
Assess The Property Conditions
As you narrow down your search and start going to open houses, you’ll need to look out for red flags. Most importantly, checking for any problems that will be difficult or expensive to fix:
- Water damage or mold
- Old insulation
- Electrical wiring issues
- Damaged roof
- Older HVAC, heating, A/C systems
- Issues in plumbing
- Uneven floors
- Cracks in the exterior
As you start going to open houses, come prepared with a list of questions. For example, why do the sellers want to move? When was this house built? Are there any issues or problems with the home? How long has the house been on the market?
Think About Features You Can Personalize
Don’t get too hung up on minor cosmetic details like paint color, landscaping or lighting fixtures. While a beautiful coat of fresh paint can be enticing to home buyers, it’s easier to paint the walls than to replace a damaged roof.
For more complicated renovations, like updates to the kitchen or bathroom, carefully consider your budget. It can make sense to choose a home that’s more of a fixer upper if it’s in your perfect location and has the other major features you need.
If you plan on renovating your home, keep track of your closing costs and move-in expenses. You may feel eager to start renovations as soon as you move in, but some updates may have to wait until after you’ve paid the more urgent expenses.
Separate Your Needs From Your Wants
You may really want to live near downtown, but you need to stay within your budget. While it’d be nice to have your cake and eat it too, you’ll probably have to make some compromises as you search for your dream home.
Separating your needs from your wants can feel a bit like a balancing act at first. However, eventually things will fall into place as you reach your dream of homeownership.