Buying a Home? Four Tips to Consider

That’s one reason it’s so important to have a real estate attorney on your team. If you’re planning on buying a home in the near future, here are four important considerations:

Don’t buy unless you plan to stay put for a while. There are lots of expenses associated with buying a home, and if you move within a couple of years you’re probably not going to be able to recoup the costs of buying. Do a careful analysis of the cost of renting versus the cost of buying—including extras like inspection and closing costs. It may make more sense to rent if you’re going to have to move after just a few years. Don’t forget to include the costs of potential home repairs when you’re thinking about whether renting or buying makes more sense for you.

Pay attention to school quality. You don’t need to have kids to take an interest in the quality of the neighborhood schools. School quality is often important to buyers, so buying in a good school district can really help the resale value of your home.

Do all the math. The decisions you make during the buying process have a significant impact on your financial future. For instance, you often have the option of paying extra points at closing to bring down the interest rates. This can be a great money-saving idea if you’re going to be in the house long enough that the savings in interest exceed the cost of points.

To avoid sticker shock, it’s a good idea to figure out the likely total closing costs well ahead of time. Closing costs include title fees, settlement fees, origination fees charged by the lender, and taxes.

Your calculations for total monthly housing costs should include what you’ll be paying for insurance and taxes. Taxes and insurance can vary wildly from state to state and even district to district—so to avoid surprises, it’s always a good idea to know ahead of time exactly what the number will be for the house you’re hoping to make your home.

Don’t just depend on your realtor—do your own homework. It’s important to have realtor on your team, but you should perform your due diligence as well. For instance, there are online sites that can give you a good idea of what you can expect to pay in a given neighborhood. What are the pricing trends in the neighborhood where you’re considering buying? If prices are either falling or rising dramatically you may want to investigate further.