Former Real Housewives of D.C. star Stacie Turner, has moved on from her reality TV show days, into a successful real estate career in the Washington Metropolitan area. With over $200 million in career sales, she’s one of the top producing agents in the country’s capital. We were able to chat about home ownership with this leading lady and glean a couple of very important factors to take into account when considering to buy a new home.
Buying a home is most people biggest financial purchase. So it is important to view it as not only a place where you live but also as an investment that should appreciate over time. The goal is to use property to accumulate wealth. It is an asset that should increase in value over time and frequently serves as an asset that you can leverage to make other financial purchases. For the young buyer, it is doubtful that your first home will be your “forever” home. So, purchase a place that has broad appeal and is in a desirable location or an up and coming area.
This age-old saying is TRUE! Don’t rule out a house that may not be “perfect” looking if the location is attractive. You can always make cosmetic improvements…ugly wallpaper and paint can be easily fixed later. But you can’t move the house elsewhere. Consider the type of lifestyle you want. Do you want to walk to restaurants and shops? How far is the house from where you work? If you have young kids or are planning to have them, how about the schools?
Don’t End Up in a House Poor
Sometimes homebuyers “fall in love” with a house or neighborhood (or even just the idea of owning a house). This can lead to regret when the novelty wears off and you don’t have any money to do the things you’d like. Try living for six months on a “pretend” mortgage payment and see how it goes.
Create an “ALL-IN” House Budget
Most buyers understand that a mortgage payment is typically comprised of principal, interest, taxes, and insurance. But it’s important to add in the extra expenses you will likely incur such as utilities, condo/HOA fees, cost of commuting, lawn maintenance, decorating costs, etc.
For example, to forecast monthly utility costs, you can call the local utility company and ask for an estimate…and often set-up budget billing which spreads your costs over the entire year to avoid spikes. Consider, will the gas budget for your car will increase if you are moving further away from the places you frequently visit? Budget ALL of these expenses and see if you can still afford the house.
Understand Your Contract Before You Sign It
A house is probably the largest purchase you will ever make in your life, so make sure you understand the terms of your contract. It is your realtor’s job to explain the details and terms which are legally binding. In some jurisdictions, a contract can be 40-50 pages! Choosing a good lender is equally important; as they should pre-qualify you for a loan and educate you on all financing options and programs for which you may qualify. Nothing should be a surprise in the process.
Obtain a Loan Pre-Approval BEFORE You Start Shopping
In most markets, a lender pre-approval letter is required to submit an offer on a property; it shows your purchasing power and that you are serious. A lender will review your salary, credit and the source of funds for the purchase to determine a comfortable loan amount. It’s a good idea to talk with more than 1 lender to compare rates and programs. The laws have been changed enabling purchasers to consult with multiple lenders within a 30-day period and their credit inquiries will not negatively affect your credit score. So you have nothing to lose.
There Is No PERFECT House Or PERFECT Time to Buy
If you are looking for the perfect house or trying to time the market, then you will never buy a house. The best approach is to clearly identify your must-have features and “nice but not necessary” features. The goal is to find a home that meets the top 4 or 5 items on the list….. and be realistic that you likely won’t find everything you want within your price range. So, be clear on the trade-offs you are willing to make.
Featured photo: Stacie Turner
To learn more about Stacie Turner and home buying, check out her website https://homesbystacie.com