Buying a home can be a very time consuming and frustrating process. Without knowing exactly what you want and how you plan on getting it, you can easily spend several hours, days and even months searching for a new home. You can avoid this by doing most of the legwork before reaching out to your real estate agent and walking into your first home. Instead of focusing on property specifics, think about what is really important to you. Only when you are clear on exactly what you want should you start the process. Here are four tips to help you save time when searching for a new home.
- Set Guidelines and Parameters. What do you want out of the purchase? This question sounds basic enough, but many homeowners get caught up in the process and end up looking at properties that don’t fit their vision. The very first thing you should do is come up with a few buying guidelines and parameters. The most common starting point is the price. Instead of focusing on the full price of a home, write down your maximum monthly payment and have your lender work backwards from there. Then you can think about location. Are there any areas that are off-limits or deal-breakers? Conversely, are there are few towns that you want to make your sole focus? Price and location account for a majority of your buying decision. The remaining items are style, room counts and square footage. The clearer you are on what you want, the easier it is for your real estate agent to find it.
- Secure Financing. Much has changed in the mortgage market in the last few years. If your last prequalification letter was from a few years ago, you need to get it updated. Even if it is only a few months old you should have your lender or mortgage broker re-pull your credit report and provide you with an updated list of items needed. With increased buyer demand in many areas, your ability to close quickly can often push your offer over the top. You should have all of your mortgage items ready in advance of making any offers. Once your offer is accepted you should quickly send over your tax returns, pay stubs and bank statements to avoid any delay. The smoother the financing side of the deal is the smoother the entire transaction will be.
- Drive the Area. There is a lot that can change within a few miles in any given town. You may like the schools or taxes a certain town has but do you really know the area? The best way to familiarize yourself with a specific region is to drive the area. See what the market looks like at different times of day. You should be able to tell which pockets of a town are more desirable and which to avoid. Pictures can tell you how a property looks but it won’t tell you about the street. A property located on a busy intersection may not be the best if you have a family with small children. A few trips in the car after dinner can help you decide which areas are best for you.
- Reserve Capital. There is a difference in your budget and what you really want to spend. As you determine your proposed monthly payment you also need to consider your available reserve capital. Knowing your down payment, closing costs and property taxes is one thing but there are also hidden buying costs. You need to factor in the cost to move and more importantly the cost to furnish your home. If a house needs extensive repairs you need to have the capital to do so. Your reserve capital needs to be a serious buying consideration.
Focusing on these four areas will help give you a clear idea of exactly what you want and where you want it. Knowing these four items will help you save time and make the buying process as efficient as possible.