Tips on Buying a New Home from Real Estate Pros
If you think buying a new home is easy, you’ve probably been spending too much time watching HGTV. Everything on TV seems easy, but that effortlessness rarely translates to real life. That’s because real life has real complications, and that’s especially true when it comes to buying a house.
However, we’ve got a few tips for you straight from real estate professionals. Incorporate them into your home buying strategy to make the process quicker and easier.
Line Up Your Mortgage Financing in Advance and Get Pre-approved
There are two reasons to take this step before you even go house shopping:
- To know exactly how much mortgage you can qualify for, and thus how much house you can afford.
- To make clear to a home seller that you are both motivated and qualified to purchase their home.
Even if you think you’re well-qualified, the seller doesn’t know you from the next potential buyer. The only way to know for sure if you’re qualified for a mortgage is to get pre-approved. This shows sellers that you are worthy of credit and can be taken seriously as a buyer.
Once you get pre-approved, pay close attention to the conditions of that agreement. You should begin doing what you need to satisfy any conditions as soon as possible – even before you select a suitable home. For example, you may be required to provide certain income documents, as well as bank statements, credit explanations and other information. By meeting those requirements early, you’ll ensure a quick and stress-free mortgage process through the closing.
Get Familiar with Prices in Your Desired Areas
Just because you know what a few houses in your neighborhood have recently sold for doesn’t mean you have a full grasp of property values in the area you’re looking to buy. Before you even look in a given neighborhood, you should make sure that it’s in your range of affordability. Prices can vary dramatically from one neighborhood to another, even in the same community.
Go to real-estate websites or look through local newspapers to see what prices are being asked for homes in the area. Do your homework so you’ll be prepared for the price levels when you go out looking. Everyone wants a nice home, but it will do little good to look at properties you can’t afford to buy.
Investigate Local Schools – Even if You Don’t Have Kids
It’s important to know what amenities there are in a neighborhood or community. This can include recreational amenities, cultural events, shopping, houses of worship, and proximity to public transportation and major highways.
One of the most important amenities in any neighborhood is the local school system. When it comes to property values and neighborhood desirability, the quality of the local school system is sometimes the most important factor.
Don’t ignore this part of your research just because you don’t have children. School quality is an important attribute in any community, even among people who don’t have children. That’s because buyers are keenly aware that the quality of the school system is a critically important factor in determining current and future property values.
Don’t just go by word of mouth on this issue. Look up the schools in the community on GreatSchools.org. They provide a numeric rating of schools – elementary, middle and high schools – from 1 to 10, with 10 being the most highly rated schools.
Attend Open Houses
Have you ever heard the term “kick the tires?” It usually applies to car shopping, and refers to not only looking at cars that are available, but sitting in the driver’s seat, trying out the features and even going on a test drive. The same is true when it comes to buying a house. Today, most people search for everything on the web, but a house is a tangible item you want to experience in real life (not just virtually) to get a true sense of what is being offered.
The home buying equivalent of kicking the tires is to walk through houses for sale. The easiest way to do this is by going to open house events. You’ll find them in almost every neighborhood on any given weekend of the year.
Open house means exactly what it says – anyone can come in and look. You should take advantage of that, particularly in any neighborhoods you’re targeting for purchase. This will give you an opportunity to see specific homes in that neighborhood, and may help you decide whether you want to pursue a neighborhood or cross it off your list.
Work With Trusted Professionals
When you’re buying a home, you don’t just need service providers – you need partners. Those are professionals who take their business seriously and have a vested interest in getting you a good deal. This includes your mortgage lender, real estate agent, home inspector and closing agent. Don’t go by price or even by a business that does a lot of advertising. Instead, rely on personal referrals.
Work with the right people and the entire home buying process will be easier and less stressful. In fact, one of the ways to recognize a competent professional is one who can anticipate problems and obstacles. They have a way of preventing small problems from turning into big ones through advanced planning.
Sell Your Current Home Before Buying a New One
Home sellers prefer “clean buyers.” A clean buyer is one who doesn’t have a previous home that needs to be sold before closing on the new property. A lot of people are afraid of being homeless and don’t even bother to sell their home until they have a new one under contract.
That may comfort the buyer, but it’s a serious problem for a seller. It means you can’t close on his home until you sell yours. Maybe that’ll happen in a few days, or maybe it will take a few months. Either way, an anxious seller may not be in a position to wait on your sale.
This becomes particularly important in strong housing markets, where sales often attract multiple bidders. It isn’t always the person who bids the highest that wins. Often, the person whose offer is accepted is the cleanest buyer. They’re essentially ready to close from the moment the contract is accepted.
One option would be to sell your house with a contingency that you will live in it for at least 30 days after the closing. After you close on the sale, that’s when you should begin looking to buy a new home. You’ll enter the market as a clean buyer, with a strong bargaining position as a result.
Home buying is never as easy as they make it seem on television, but follow these tips and you’ll be in your dream home in no time!
This is for informational purposes only. This is not intended as legal or financial advice.