Ten Things To Know Before Buying a Home in Southern Maryland
With school dismissed and a warm Southern Maryland summer upon us, more and more families are taking the time to go house hunting. While I’m sure you’ve heard at least some of these before, I think now is a good time to go over some basic information if you’re looking to buy right now. The Boston Globe has a great Top Ten list that I’ve added my ten cents to.
1. Make Your Financing Stand at Attention
Take a minute and step into the seller’s shoes. It’s great to get a full price offer, but it doesn’t mean squat if the buyer can’t get the financing lined up to go forward with the purchase. Before starting your search, talk with a lender to find out what you really can afford and what you actually want to spend. The best way to show a seller you’ve got the financial ability to make good on your offer is to have a pre-approval letter no more than 30 days old.
2. Where Do You See Yourself in 1 year? 5 years? 10 years?
What type of property is best for you can sometimes come down to short term or long term investment. If you plan on buying something and holding on to it for less than 5 years, then school systems and amenities may not be very important to you. If this is going to be your home for the foreseeable future, then sometimes paying a little more to be in the community you want is a smart investment.
3. Understand the Current Market
This is something that you don’t need to feel you have to figure out on your own – that’s what your Realtor is for! Have them explain to you what comparable properties have sold for over the past three months so you can better understand what your buying power is for each area you’re looking in. Your Realtor can also target in on the market on just foreclosures and short sales also. Sites like Zillow.com usually give inaccurate information to buyers and sellers since their figures can be based on sales information that’s over 6 months old. In a fluctuating market like we are experiencing, up to date information has never been more important.
4. Don’t Stretch Your Buying Power Too Far
Don’t get stuck in the thinking ‘if I can just make an extra $200 a month toward a mortgage payment, then I’ll make even more money when I sell the house.’ What if you can’t make that extra amount? Not only are you now facing foreclosure, but you’re also looking at your credit being decimated and barring you from possibly buying another home anytime in the near future. Stick with the price range you’re approved for and you’ll be just fine. Still worried? Stick closer to the lower end of your pre-approval amount.
5. If I Just Wait, I Can Get an Even BETTER Deal
All the signs are starting to show that we’ve seen the bottom of the market, or are at least at the tail end of the bottom. Ask any Realtor and they’ll tell you that great deals are getting harder to find. If you don’t put in an offer on a ‘great deal’ right away, you don’t have a chance of getting it. I’ve seen properties go up on the market and within HOURS it’s under contract. A good Realtor won’t encourage you to buy anything overpriced, even if you want to. If you’re still not convinced on moving on a property, have your Realtor whip up comparative listings for that property to see how other similar homes have sold in the area.
6. Don’t Be Swayed By the Swag
Sellers are usually coached by their Realtors on how to best show their home. Sometimes, professional home stagers are brought in to make it ‘feel like home.’ No matter how much you love the chaise lounge in the living room or the antique sleigh bed in the master bedroom, try to see past them to envision your own furniture fitting in the space. You can always write an offer that includes some of the furniture, but first focus on the actual rooms and not what’s filling them.
7. I’ll Take Home Buying for $400 Alex
In the home buying process, knowledge truly is power (that’s one reason you’re working with a Realtor, right?). Ask as many questions as you can about the property! Standard questions include: how old the roof, heating system, hot water heater, and windows are; if the basement has taken water in the time the seller has been there, and if there’s a sump pump; and what utilities and homeowner insurance generally cost. But you can also ask them about local parks, the schools their kids attend (and if they like them), even their favorite thing about the community. If there’s been recent renovation work, you should have your Realtor find out of all building permits have been signed off and if all of the contractors and sub-contractors have been paid in full. If there’s a pool, also make sure your Realtor confirms it has a permit on file.
8. It’s So New and Shiny!
There are some good deals to be had if you’d like to buy new, yet you should not rule out resale properties. Builders usually advertise the lowest price of the smallest model to get you in the door. Then, as you’re looking at all the documents, you realize that your $250,000 house is really going to cost you $375,000 because everything you thought was included (granite counters, hardwood floors, etc.) are actually options. Put that together with a subdivision that may still be unfinished even when you do move in and may be further away from ‘civilization’ than you’d like, and a new home may not be right for you.
9. Buying a Condo ≠ Buying a House
With the credit crunch, getting financing to purchase a condo has become more difficult for some buyers. Specifically, lenders generally want buildings to be at least 50 percent owner-occupied. You also have to consider the HOA documents and restrictions you may encounter when you go to sell it.
10. Is It Everything You Want?
When it comes down to it, you need to be comfortable with your purchase and not get buyer’s regret. Before putting in an offer, go over what you were looking for in a home (like a big lot, lots of rooms, pool, good schools, etc.) and see how many of those wants match up to the property. For investors, this is usually easier because you’re mainly looking at numbers. But for your average family looking to get their first home or move up to a larger home, the numbers aren’t the end all be all. If you have very specific needs or wants and can’t (or won’t) budge on those, then keep in mind it may take longer to find ‘the one.’
If you’re ready to start your home search and need a Realtor, I know a pretty great one that would love to help!
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Jon Benya Keller Williams of Southern Maryland
tel (301) 653-8113
fax (301) 632-5481
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