Key takeaways
- Because it’s a major financial decision, home buying requires a business-minded approach.
- Focus on needs first, and then affordability.
- Take command of the process by making your own choices.
- Relax! Understand that you can proceed “one step at a time” to buy the right home for you.
For most of us, a home isn’t simply a purchase. Over time, it becomes a place packed with fond memories of times spent with family, friends and loved ones.
However, buying a house will likely amount to the biggest purchase you’ll make. As a result, you’ll want to apply business-minded strategies to your decision. With this in mind, consider the following best practices for making a great personal—and financial—choice.
1. Don't "fall in love" too fast
Yes, buying a house should touch upon your emotional chords. But you must also reconcile your dreams with the realities of your checkbook. So avoid temptations cast by agents to get you to “fall in love” at first sight, with statements such as “Oh, this house was meant for you,” “It really suits you,” and “I can tell this is perfect for you. Don’t you just love it?” Focus on what you seek in terms of location, space, upkeep and of course, affordability. In other words, it’s about what you need that fits within your long-term budget plan, as opposed to what you want.
2. "Steer" the process
Agents can be very assertive in attempting to “tell” you what to buy. What’s more, loved ones who won’t even live in the house may aggressively offer opinions about the subject. Subsequently, you could slip into a pattern where you strive to please others, instead of serving yourself. So put yourself “in charge” and “steer” your own home-buying process, focusing on the previously described essentials of needs and affordability.
3. Understand the responsibilities of ownership
Renting is easy. You write one check a month, and the landlord is supposed to take care of the rest. Owning a home is more complicated. You must remember to pay your mortgage, assessments (if any) and real estate taxes. You should buy enough hazard insurance to protect yourself against loss or damage to your house and its belongings. You need to cut the lawn, clean and fix things on a routine basis (or pay to have them fixed).
If you carefully consider it all and conclude, “This is too much to take on right now,” then the life of a renter should suit you fine until you’re ready. On the other hand, if you embrace the thought of this new lifestyle, then full speed ahead!
4. Be decisive when it’s time to place an offer
To move forward with the purchase, you have to be sure that you want it. Committing to a down payment and mortgage, after all, could mean that you delay that luxury vacation for a year or so, or continue to drive an old car you were looking to replace.
But once you’re sure that it’s time to buy, don’t second-guess yourself. You have to put down a firm offer, or you’ll lose out on what could be your home for a decade or more. If you’re simply worried that the minute after you make your offer, a better house at a better price might come along, remember this: There’s more than one house that’s right for you. But now is the time to act.
5. Take it one step at a time
Throughout it all, take comfort in knowing that you don’t have to figure everything out at once. In many ways, this is a journey, and you can take some time to conduct business-like “due diligence.” For example, if you find yourself overwhelmed by the thought of choosing a neighborhood, start exploring areas slowly, one by one.
Once you’ve settled upon a few neighborhoods, you can assess their impact upon your daily routine. Conduct “practice” commutes during rush hour to your job, for example, so you know what to expect.
Then, break down all of the budgeting details—evaluating what you can afford in a down payment, monthly mortgage, insurance costs, repairs, etc.—and determine which available homes in your preferred neighborhoods fall within your comfort zone. When you buy the right home at the right time for the right amount of money, you won’t have buyer’s remorse. Instead, you’ll look forward to your move as an exciting challenge.
