Some may tell you that all homes appreciate in value over time – or that it doesn’t matter, because you’re buying a home to have a home, not an investment.
The truth is, most Americans do move every few years, so thinking about that house as an investment as well as a home is a smart financial move.
- Choose your location wisely.
In fact, don’t even look at homes that are in the “wrong” location for you. You need first to consider your own situation and gravitate toward neighborhoods that will allow you to spend time at home rather than on the road.
In terms of appreciation, look for neighborhoods that are well-maintained and/or going through multiple upgrades. And then, whether or not you have children, consider the school district. Parents across the country are paying more for a home in order to get their children into top schools.
Do drive through the neighborhood looking for “For Sale” signs – too many is a good sign that others are finding it less than desirable. Keep looking.
- Search for the smallest, least-updated home in a neighborhood of nice homes. (Never choose the largest home in a neighborhood of small to medium sized homes.)
If you’re able to find the only home on the block that doesn’t have a deck or hasn’t had a kitchen upgrade lately – but you can afford to make those improvements – you’ll add instant value. In addition, pay attention to the size of the lot, since you may want to build an addition later on.
- Look beyond the lipstick and rouge – or lack of it
Curb appeal: Savvy home sellers go to lengths to create “curb appeal” to draw you in and cause you to expect to love the house before you walk in the door. And it works, many buyers completely pass over homes with poor curb appeal.
So go against the norm and take a look. While it’s true that neglect outside might signal neglect inside, it’s also true that it might not. You don’t know that homeowner’s circumstances. They may be physically unable to do yard work and may not have the budget to pay for it. The interior may be impeccably maintained.
Take a close look – are YOU able to turn that yard into a thing of beauty? If so, you’ll immediately increase the value of your new home.
Décor: Ignore the gaudy paint colors and leopard-print carpet. Forget the ugly couch and the velvet art on the walls. Those things can be changed immediately. Meanwhile, they’ve sent other buyers scurrying out the door, so the price might more than compensate for the cost of getting fresh new paint and flooring.
Instead, look at how the home functions and flows. Check to see that the number of bedrooms and baths fit your household, and that the room sizes will accommodate your furnishings. Look at the closets and the other storage spaces, and then…
- Get an inspection.
So many hidden things can be wrong with a house, that it makes a home inspection just about the best insurance you can buy. The inspector checks everything from top to bottom and will give you a written report outlining any and all issues.
Some, of course, are small issues. The inspector may point out that they don’t even need to be addressed. Others, however, can be major. Structural problems, pest infestations, polybutylene piping, a failing septic tank, or foundation failures fall under that category. Repair of these items can come with huge price tags.
Once the inspection is finished, go over it with him or her and ask questions. Find out which issues are major and which are minor. Then talk it over with your real estate agent. He or she may be able to get repair estimates so you can get a true picture of costs.
- Don’t over-pay
Experts say the way to make money on a home is at the purchase, not the sale. That means – never over-pay. Your agent will help you compare prices and values so you don’t make a huge mistake. He or she may also be willing to do a comparative market analysis to give you a clear picture of the home’s value in the current market.
In addition, never pay all the bank allows.
Leave room in your budget for unexpected expenses and for things your lender didn’t consider – like the fact that your kids like to go to summer camp, you like a skiing vacation every winter, or you love dining out or attending concerts.
The First Step
When you’re ready to find that home, the first step is to get pre-approved for your loan. So call Homewood Mortgage, the Mike Clover Group, and let’s get started.
Reach us today at 469.621.8484.