Buying a Home
Buying a home is one of life's most important investments and exciting adventures. Even experienced buyers, however, can find this complex process a bit overwhelming. We will guide you every step of the way. In addition to the crucial step of locating and presenting properties that match your search criteria, we will help you along the path between "I want this house!" and "I own this house!"
The Search Begins
You should start your search by determining your price range, and how much can you afford. While lenders use different formulas for arriving at this figure, a general rule of thumb is that you should spend no more than 28% of your gross monthly income on housing costs or PITI (principal, interest, taxes and insurance), and no more than 38% on combined total monthly house and other long-term debt payments. However, each person's financial picture is unique and we'll be happy to put you in touch with a lender we trust to evaluate your buying power.
Understanding the Asking Price
Many factors influence the price that a seller expects to get for their home. While only you can decide how much you feel comfortable offering for a property, we can gather critical information for you regarding the factors that impact how much you should consider paying for the home.
These factors include:
- How long the home has been on the market
- If the price has been reduced
- The prices for other comparable homes in the area
- If there are multiple offers
- Other items that might be included in the sale – furniture, hot tub, etc.
- The "list to sale price ratio," an indication of how competitive the market is for homes in this area.
- Why the seller is selling
- Whether the seller is offering an assumable loan or financing
Negotiating the Offer and the Contract
You may make your offer subject to certain terms or contingencies, including securing of financing or perhaps the sale of your current home. You may also make the contract subject to various inspections by both you and professional inspectors. Most contracts include some standard provisions, such as property taxes, insurance costs, utility bills, and special assessments, which will be prorated between buyer and seller. Others outline what happens if the property is damaged before closing, or either party fails to go through with the sale. We will review with you every aspect of your offer.
Together, we will plan a strategy for getting the most advantageous terms for you – the buyer – at the price you are willing to pay for the property.