Home Buyers: Seven Insights Into Confident Decision Making
On the surface, buying a home seems simple: find your dream home and buy it.
In reality, this seemingly-simple task requires buyers to make a continuous stream of under-pressure decisions, often concerning issues and consequences they do not fully understand. Instead of one task, buyers are faced with hundreds of tasks many of which must be decided on simultaneously, on very short deadlines. This makes decision-making a challenge, but it’s the knowledge gaps and “I’ve never thought about this before” perspectives revealed in smart home buying that add the real pressure.
At its best, purchasing real estate is an exhilarating race through a labyrinth of snap decisions ending with the purchase of real estate. At its worst, home buying can become a multi-tasking nightmare culminating in the purchase of the wrong property, in spending too much, or in no purchase at all.
To swing the outcome in your favor, one key task is choosing the “best fit” real estate professional to guide you through the home-buying process. This real estate expert will keep you fully informed, so that even snap decisions are solid choices you will thrive on.
Face the complexity of successful home buying head on and it will not overwhelm you.
Purchasing real estate involves making a series of decisions which combine to address the essentials of successful real estate ownership. The “I’ve never thought about that before” perspectives that challenge decision making, especially for first-time buyers, can be categorized by the specialized knowledge required.
Here are Seven Insights into Successful Multi-Tasking:
#1. Investment: What is the value-appreciation potential of the property?
Does it seem strange to think about resale value when you haven’t even purchased yet? This perspective is important since it reveals current value deficits. In addition, after paying off the mortgage (and many thousands in interest), and maintaining and improving the property over the years ahead, you’ll want to recover these costs and make a profit to finance the next phase of your life. Even a “forever home” should be purchased with investment in mind since the future is full of surprises. Location is key to resale value. The best strategy is to buy the least property in the best neighborhood you can afford.
#2. Lifestyle: Which lifestyle values should the chosen property reinforce?
Are you determined to spend your time, money, and effort on accumulating “stuff” and teaching your children to do the same? If so, square-footage, lots of storage, and a bedroom each may be essential. If your values go beyond materialism, the size of the building may not be as important as highly-functional interior design, the surrounding community, and local amenities and green spaces. Shop neighborhood before you start looking at individual homes.
#3. Benefits: How do you expect ownership to benefit you and your family?
We addressed investment and its links to your financial future in #1. How else do you expect the home and neighborhood to benefit your family? For instance, locating near select schools has taken priority over locating adjacent to work for many buyers, but make sure the school in question is not so over-populated that its standards are slipping. Compare the cost of alternatives schools to the premium that real estate in “star school” neighborhoods demands. If a private school or home schooling is intended, “star” amenities may take priority over neighborhood schools.
#4. Time Management: How should your real estate support income earning?
Jobs tend to be more plentiful in urban areas. Real estate prices are usually lower and appreciation slower further away from urban centers. The expense of commuting to work goes up the further away you live. Do the math to determine what you’ll net in salary after deducting the cost of commuting. Add a calculation of how many extra hours the distance will take from your family, interests, health, and fun. Only you can determine what this time is worth when you evaluate the value of buying a larger home further from city center.
#5. Property Management: How much time and money will maintaining and regularly modernizing your property require?
Gardening can be a great joy, but mowing a large lawn can be a great responsibility—and an expense if you pay someone else to mow. The larger the house, the higher the taxes, the bigger the roof, the more plumbing and wiring involved, more windows to decorate, more furniture to buy, and more space to heat and cool…. The costs attached to maintenance are annual, increasing expenses and should be considered when setting the budget for a purchase.
#6. Borrowing: How much will the cost of borrowing add to the overall cost of home ownership?
Mortgage interest and related costs are not the cost of real estate since not everyone needs a mortgage. These expenses relate to borrowing, but they can be large enough to make you house rich and cash poor. Financially stretching for a dream home, may be your choice knowing your earning power is on the rise.
#7. Backup: How will I find reliable, accurate, unbiased answers to my questions during the buying process?
GoogleTM should not be your “go-to” resource during home buying because it holds no liability if you get the wrong information or if you don’t know what you don’t know and should know about a topic. Settle on a real
estate professional with the knowledge and experience relevant to the locations and type of real estate you are interested in. When you ask this local expert a question, they will know the complete answer or know how to get it. Real estate professionals understand that they carry fiduciary responsibilities to provide the right information at the right time, so their client (that’s you) can consistently make confident decisions to achieve their stated goals.
The more you understand the home-buying process before you start, the better prepared you’ll be for a multi-tasking decision-making marathon. The many small decisions about style of home, mortgage term, closing date, garbage and mail services, side of the street, distance to medical services and the firehall etc… will be manageable. You’ll be ready to confidently make significant decisions about which property, how much to spend, and which responsibilities to commit to in the offer to purchase.
Written by PJ Wade for Realty Times Staff for www.RealtyTimes.com Copyright © 2015 Realty Times All Rights Reserved.