January 6th, 2020 7:35 AM by Jackie A. Graves
Is 2020 the year you finally decide to buy your first home? How
much practical, valuable real estate advice did you ignore in 2019? What’s your
intent for 2020?
Whether 2020 represents time for a fresh start or continued work
on important real estate goals, you don’t have to look any further than
RealtyTimes.com to discover inspiration and relevant information.
In the spirit of “Keep It Simple, Sweetie” decision making,
here’s Six Key Buying Strategies to consider when deciding on your first-home
buying strategy. This is the thinking to do before you zero in on decor “must
haves” like dream kitchens and spa-like bathrooms.
Location is the most permanent aspect of real estate; buildings
can always be changed. Buy the best location you can
afford. Do your homework and talk to real estate
professionals to fully understand what location means in the communities and
neighborhoods you’re considering for your first home.
Buy at the low end in the best location to ensure your real
estate appreciates in value. The most expensive house on a street or in a
neighborhood usually has its value suppressed by lesser homes near it. Buy the
“least house” on a street or one in the mid-value range and your home may be
bumped up in value as high-end homeowners continue to up-grade their castles.
If you are determined that your first home will be your “forever
home,” you may be taking on too much. First homes should be financial
stepping stones to that ultimate lifestyle realization. Wisely
buy and sell two or three homes over many years—building equity as you go—to
solidify your financial stability. If you start with a “forever home” and skip
this progression, you are searching for a home and a neighborhood to spend 60
or more years in. Really? In a world that changes so rapidly each year, each
month, each day, how can you be so sure of what you’ll need and enjoy decades
down the road? Buy a very large home for the many kids you want to have and you
may overspend for the family you have now or be forced to move out of your
too-big, too-much-work “forever home” when the kids leave.
If you’re thinking long term, search out stable economic areas
and homes that can be easily modified to add and convert income-generating
units. Flexibility of lifestyle and income is what survives over time.
Maxing out financially on your first home may not be the best
real estate strategy. “House rich, cash poor” is not the ideal state to live in
to fully enjoy your first home. Spending to the limit leaves no
room to improve the home and increase its value. Being
cash stretched may put you at financial risk if a big repair like a leaky roof
or failed furnace pops up.
Because you qualify for a big mortgage does not mean you have to
borrow or spend to the limit. Because you like the expensive home more, does
not mean that’s the one you should buy. Is keeping monthly payments manageable
more valuable to you than impressing visitors?
Consider your first home as the first financial stepping stone
on the way to a mortgage-free forever home. Ask your real estate professional
to share a range of financial options with you instead of directing them to
“buy as much as I can.”
Retail shopping has trained shoppers to think seasonally. With
real estate, “now” may be the best time to buy. When you’re ready, go. Search
and purchase when the masses are not and you may get a terrific buy from a
seller who must move immediately and can’t wait for Spring.
Wintery weather may mean less traffic through builders’ sales
centers and more attention paid to you. You may even find a few buying
incentives thrown in. Wait until Spring and you may pay more and feel very
pressured in the process.
Can you see beyond idyllic stereotypes of country living when
considering "the big move" to cheaper, non-urban real estate? Moving
into the suburbs or out into the country may mean you get a bigger house for
your budget. If square footage is what matters most now and in the future, away
However, if lifestyle, career opportunities, education choices,
internet access, health services, and appreciating real estate value are key
considerations, look closely at what you gain and
give up by moving out of an urban neighborhood. How many
urban problems will you really leave behind? Small town and rural homeowners
face many of the challenges city owners do: rising food and fuel costs, rising
taxes, and environmental challenges. Which rural concerns like water quality,
black outs, less convenience, and scarcity of services may significantly affect
your home and lifestyle?
If your search for a new home or cottage uses criteria set by
“what's on trend," you are following the herd rather than leading
yourself. For instance, open concept living space is "in," but not
without compromises. If you're not aware what you give up to get "open
concept," you have not explored all the options open to you.
Wanting housing similar to or better than your peers may be a
sign of compatibility, but make sure you’re not extending yourself financially
for superficial reasons. Showing off is not a sound investment
strategy. Learn where those you follow originally got the
ideas that define their lives. Their reasons for acting may not match yours.
Everyone has to discover what real estate styles and ownership
type are right for them. As you learn, be ready to get in there and explore all
your options, not just the trendy ones.
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