When you’re getting ready to shop for a new home, it can be difficult to know exactly what you should be looking for. One of the first things your real estate agent is going to ask you about so that they can help you find the right home for you is what you want and what you need. Here are some ideas to help you figure that out.
Get Your Budget Lined Out
Before you even begin to consider what you want from a house, you’ve got to figure out how much you can spend. Ideally, you’ll apply for pre-approval from the lender of your choice before you even begin shopping, maybe even before you contact a real estate agent.
Your letter of pre-approval will let sellers know how much money your lender is willing to lend you, but that number isn’t the end-all-be-all. The payments on the maximum amount you can get to buy a house may be, realistically, out of your budget. Make sure you sit down with either your mortgage broker or real estate agent to figure out an actual amount that you can comfortably afford. Ideally, that will account for the entirety of what you’ll pay monthly for your new home including home insurance, taxes, and mortgage insurance if it’s required.
You’ll want to shop based on your ideal payment rather than the maximum loan amount on your preapproval letter.
Determine What You Need from Your Home
Your family situation will determine a lot of what you need from your home. Start by considering the minimum standards you can live with. Then, work your way up to the features that make up your ideal home. Here are a few factors that you’ll want to figure out your stance on.
Neighborhood
Are you limited to one specific neighborhood or do you need a home within so many miles of work or school?
Type of Home
Is a single-family home necessary or could you get by with a duplex, townhome, or even a condo?
Number of Bedrooms and Bathrooms
How many bedrooms and bathrooms do you need and how many do you want? This is an ideal place to consider resale value since homes with less than three bedrooms and/or two bathrooms may fetch a significantly lower price.
Square Footage
How big a home do you need? It’s a good idea to keep a fairly open mind on this one and avoid hard limits since the way a home is laid out may make all the difference. How much outdoor space do you need?
Floor Plan
Is the wildly popular open floor plan a deal breaker for you, or do you prefer separate spaces? Do you need one level or will multiple stories be acceptable? How much storage space do you need?
Garage/Parking
Do you need or want a garage or is it of no consequence to you? Can you tolerate on-street parking or does your ride need a private parking space or a driveway?
How Much Work are You Willing to Do?
Are you up for a bit of a project house or do you need a home that is move-in ready? Your loan type may also determine whether you’re able to purchase a home that has certain issues or if you can include money for repairs or remodeling in your loan balance.
Be Prepared to Compromise
Be honest with yourself about your needs and wants so that you know where you can stand to compromise. Odds are, you aren’t going to find a home that ticks off every one of your needs and wants. You may find that you’ll need to compromise, or at the very least, plan to do a little renovation down the road.
Make sure that you’re being realistic about the types of homes available in the area. For example, if you’re looking for a single-family home in a city where there are very few of them and they are generally well out of your price range, you may need to adjust your ideas.
Don’t Ignore Your Wants Altogether
While you may not be able to find your dream home within your budget, you don’t want to ignore the things that you want. If your house meets your basic needs but you really don’t like it, it’s probably not the one for you. Purchasing a home is a big commitment, so make sure you’re able to balance the budget and its appeal.
Share Your Ideas with Your Real Estate Agent
Make sure that you communicate what you want and need to your real estate agent, even if some of your stipulations seem a bit far-fetched. They will be able to let you know what is realistic for your budget, and they’ll also be able to keep an eye out for all the features you’re hoping to find in your new home.