For first-time homeowners, the real estate market can seem confusing and alien. Buying a house looks easy, until you actually do it. Here are five important things you should know before taking the plunge:
Preparing for Purchase
Becoming a homeowner isn’t as easy as just pointing to the first property in your price range and saying “I’ll take it.” The steps to buy a house that you have to follow exist for a reason. Checking your credit report and saving up for a down payment ensures that you’re financially ready for such a responsibility. Applying for a mortgage ensures that you have a roadmap to ownership. And getting an inspection ensures that you know exactly what you’re getting into.
Hidden Costs and Fees
Buying a house is always expensive, but the full cost is not limited to a property’s list price. There are plenty of hidden fees that are easy to overlook, including the cost of hiring an inspector (as mentioned above) and the cumulative interest that any mortgage builds up over time. If a property needs maintenance or repairs, that can also drive up the price. Then there are additional factors like house insurance, mortgage insurance, property taxes, utility bills, and more.
Making Money Off It
While buying a house may seem to require more money and work than it’s worth, the truth is that, like any investment, homeownership can pay off big time if leveraged correctly. The more equity you have in a property, the more value that property provides. Some of the ways a person can make money off of owning their home include by renting out rooms for lodgers or storage, leasing land for commercial or agricultural use, or even starting your own home-based business.
Increasing Your Value
Some people buy a house with the intention of living there for the rest of their lives. Others, however, do it with the intent to sell it and move somewhere else eventually. And then there are those who buy houses for the sole purpose of fixing them up and reselling them at a profit. Whatever group you belong to, it’s worth noting that a home’s value is not fixed. Nor is it solely tied to the ups and downs of the real estate market. Adding amenities and performing remodels can be used to increase a home’s list price.
Realtors Are Optional
Hiring a realtor to help you sell or buy a house can make navigating the tricky world of real estate a lot easier, but it’s not essential. Just because most people use agents doesn’t mean you absolutely have to. If you prefer the do-it-yourself approach, or if you’re just looking to save a little money, there’s nothing a realtor can do that you can’t do on your own. Buyers and sellers alike can negotiate their own terms, and the latter can also schedule appraisals and even market their property completely on their own.