Buying a home is likely one of the most significant things you will do in your lifetime. Searching without a plan is like throwing darts without a target and can waste a lot of time and money… maybe fun in the early stages of just considering buying but more likely frustrating when the time comes that you are really ready to find your new home.
Defining the following five factors will help you create your home buying plan.
1. LIFESTYLE GOALS
- Do you want to be close to work, recreation, shopping, restaurants and coffee shops, schools? Within walking distance? biking distance? near public transportation? or are you comfortable with driving so these things don’t matter?
- Do prefer the vibe of an urban lifestyle or a suburban lifestyle with more privacy and wide open spaces?
- Do you want move-in ready or do you like doing renovations/updates to make it your own? What about ongoing maintenance… do you enjoy working on projects around the home or not?
- Don’t choose a condo or townhouse instead of a house simply because of snow and lawn care, you can hire that done at a house just as an association does for a condo or townhouse. But do you like the security of having someone else caring for everything outside your living space… giving you freedom from that worry, more freedom to travel, etc? What about the amenities of a condo/townhouse association such as pool, exercise room, party room, etc… is that something you would use and enjoy or would it simply be an ongoing expense, even when you are not there?
2. HOME FEATURES
- Think about what is important to you inside your home… kitchen, flooring, stairs (or no stairs), number of bathrooms, master suite, closets, windows/daylight, room sizes, traffic flow, etc
- Is a spectacular view or a fenced yard important to you… or something else?
- Is construction style important to you? If you like older and historic are you prepared to deal with the potential of radiators, lack of central air conditioning, detached smaller garages, etc?
- Decide on your non-negotiable items and don’t waste time looking at properties that don’t fill those needs
3. FINANCIAL GOALS AND RESOURCES
- The financial impact of buying a home is more than the cost of the monthly mortgage payment, which usually includes principal, interest, taxes and insurance (PITI)
- Don’t forget to factor in other ongoing costs such as utilities, maintenance and repairs… and be prepared for big ticket items such as furnace, roof, siding, flooring, water heater, etc… it’s not a question of if they will need replacing, just when
- Factor in the potential for value appreciation/depreciation… its most important use is as your home, but it is also an investment which rises and falls with the market
- Talk to your financial planner about how buying a home factors into your long-term financial goals… don’t think that just because you are a young first-time home buyer you shouldn’t have a long-term financial plan
4. BUYING TIME FRAME
- How soon do you plan to buy? Do you need to sell first? Do you have your financing approval in place? Do you have to improve your credit score before you are approved? Are there other factors that need to be resolved before you even start looking?
- How long do you plan to live in your new home? Think ahead to what you expect your life situation will be like at the end as well as when you buy… will more/fewer people be living in the home? are the living spaces adaptable for different life stages when you plan to live in your home?
- Always buy with resale in mind… life happens, and situations change… even if you plan to stay in your home for a long time always buy with resale in mind to help you make smart choices
5. LOCATION
- Sights, sounds, smells – this is something you will be living with every day, when considering a home does this feel right for you?
- It might sound nice to live near a restaurant, but will constant cooking smells bug you?
- Some of the highest demand neighborhoods in the Twin Cities have airplanes flying overhead regularly, are you willing to put up with pauses in outdoor conversations to allow airplanes to pass by?
- You might love having a view of the lake or river, but will the traffic and activity it generates annoy you?
- Neighborhood personality – this is something you must personally experience to see if it feels like a good fit for you… both now and for potential changes in your lifestyle over the time you expect to live there…
- Get out and walk the neighborhood at different times of day
- Talk to people who live in the community
- Walk to parks, coffee shops, schools… visit the local grocery, bakery, other services…
- Ride local transit if this is something you plan to use
- Get a feel for the personality of the neighborhood, the age and diversity of the people living there
- Is this a neighborhood where residents get involved with each other and in the community or more of a ‘bedroom’ community? which suits you?
- When you purchase a home you are buying much more than a dwelling, you are also buying into a neighborhood and the lifestyle that comes with that neighborhood
- The old adage that the three most important things in real estate are location, location and location could never be more true… you can change things about the physical home you buy, but you can’t change its location
- Is this a place where you would like to put down roots?
Sharlene Hensrud, RE/MAX Results – shensrud@homesmsp.com
