What You Need to Know When Buying a New Home
By Eric Hammer - 2010
Buying a new home can be incredibly scary and it's not the
sort of thing that you want to take on lightly. This is especially
true in the current economy when things seem to be on such shaky
ground with jobs and real estate prices. On the other hand, now
may be the perfect time to buy a new home precisely because of
the fact that prices are so low and sellers are desperate to
unload their property. Here's how to pick the perfect new home
for you:
Have Some Imagination
Yes, you can try to look for the "perfect" home
when looking into buying a new home. However, this is a recipe
for spending a lot more money needlessly. The fact is that the
homes which look perfect, with perfect lawns and with perfect
furniture for staging purposes are going to cost more money.
If you can get past looking at the ugly wall paper and the peeling
paint on a fixer upper, you can easily save yourself tens of
thousands of dollars.
The cost of replacing that ugly wall paper and having a new
paint job done will cost no more than a few thousand dollars.
However, because the market is so wide open right now, that ugly
wall paper and peeling paint could mean tens of thousands in
savings, meaning that you'll ultimately save big when buying
your new home. The catch? You need to have enough imagination
to see it as it could be, not as it is.
Visit More Than Once
Gone are the days when buying a new home meant needing to
make a decision right away. These days, most homes for sale on
the market tend to sit for a while. This means that you can visit
more than once and make an informed decision rather than a snap
decision. This is important for several reasons. First off, this
is the place you'll be living in for the foreseeable future which
means that you need to do more than make a snap decision.
Second and more importantly, the neighborhood make look nice
during the day, but it make look awful when you come back to
visit late at night (you may for example miss that tavern down
the block or even the noisy family next door who fight with each
other every night).
Look around the Neighborhood
It's also a good idea to spend the time to look around the
neighborhood for a while before you make a snap decision to buy
a new home. The fact is that a new home is more than just your
own four walls. How close is the nearest all night grocery for
that time when the baby is crying at the 3 in the morning and
you're out of formula? How far is it to the supermarket? Can
you walk there when there's a snowstorm or will you be stuck
without food? If you don't own a car, how close is the nearest
bus or train station? All of these questions are extremely important
if you're going to be living somewhere for the long term. Speaking
of that…
Plan to Stay for Seven Years
When you rent a new home, you can plan to stay only for a
year or two before moving on if you're not happy. Buying a new
home is different. In order to recoup your initial investment
in paying the down payment on the mortgage and all the fees that
are associated with that, you need to plan to be there for at
least seven years. More is better, but seven years is the rule
of thumb to break even.
Know You'll Be Happy
Finally, if there is something you find truly annoying about
the possible home you want to buy, check in advance that it can
be changed (i.e. if there is a wall where you think it shouldn't
be and you want it knocked down, make sure that it's not a supporting
wall which must stay before you sign on the dotted line). Nothing
is worse than buying a new home and then realizing that there
is something you're going to hate and be stuck with for years
to come.
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