I'm Going to Buy A House. What Do I Do!?
Buying a home means finally being able to call a place yours, and making your decorating dreams a reality. But, before you can start moving in sofas and painting the walls, you have to actually purchase the home! And what a huge commitment that is, requiring you to research neighbourhoods, tour different properties, send in mortgage applications and file what seems like mountains of paperwork.
But, there is light at the end of the tunnel, and that is finally owning a home that you can use as an investment. Need some help preparing for this? Take a look at the tips below, which I've gathered through extensive research watching way too many home improvement shows.
Step 1: Figure out your Budget
You have to create a budget that is realistic for your income and the expenses you already have. If you don't set this, then you could easily end up looking at dream homes that you could afford, if you're willing to live without things like food... or heat... or electricity.
So, set your budget by taking into account your income each month. Then, subtract all your normal expenses (yes, add in dining out, gas, heat, etc.). Next, subtract your anticipated monthly mortgage payment along with taxes and insurance. You should have an idea of what you can afford when you do this, but be honest with yourself so you get the most accurate results.
Step 2: Set up Savings
How much money do you have set aside for a rainy day? You need an emergency fund, and that's even truer when you own a home. You need to have money set aside for plumbing emergencies, a new roof, living expenses if you were to lose your job and other things that could happen (even though you don't want them to). A good rule of thumb is to save half a year of living expenses.
Step 3: Figure out What You Want
Before buying a home, you need to think about what your priorities are with the actual home. For example, would you rather buy one that's move-in ready or one that is going to require some repairs? You should also think about the location, whether or not you will have to move in the near future (if you're going to have kids), if you would want to do renovations and other things that impact your enjoyment with a home.
Step 4: Do Your Own Research
Your real estate agent will help you with finding a great home when you're ready, but you can still research homes yourself to get an idea of what you really want. Take some time to look up information on different neighbourhoods, layouts of homes you might want and other things that will make the searching process easier in the future. Don't rush yourself and remember that this is one of the biggest investments you'll ever make, so you sure you're satisfied with it.