Knowledge is Power: Locating and Bidding on the Home of Your Dreams

In previous last article for first-time property buyers, we recommended three things: 1) Consider if your monetary situation makes it the “right time to buy, 2) pre-qualification for a home loan, and 3) selecting a real estate agent. This time we want to explore the process of selecting your home and making an offer.

The first thing to think about is not just the type of home you are looking for, but also where you want to live. This doesn’t mean picking a town and buying a house somewhere in the city limits. If you have children, for example, consider the quality of the school district. Which school will your children attend based on your neighborhood? Schools within a district can vary greatly in class size or quality of instruction. Consult not just your realtor, but also the school district itself for the latest information. Information from your agent can help you ask intelligent questions. Individual school sites and personnel are likely to present a rosy picture of their situation—district information on standardized test results and school programs, for example, is likely to be more realistic.

Is it important for you to live near recreational facilities or parks? Do you want ready access to certain types of businesses? Do you desire to walk to the store or restaurants, or do you need to be close to a commute? Figure out what’s important in your daily life; make a list of expectations for your home and stick to it. You are likely to live in your first house for some time—make sure the location fits your needs.

After locating the house of your dreams, or at least, the one that meets your expectations, it’s time for your offer. What are comparable homes selling for in the neighborhood? How long has the house been on the market? How well does it meet your list of needs? Are prices rising or falling in the property area? Are new housing developments or renovations likely to affect the value of the property? Just because you have a certain amount of funds available does not mean that your offer should represent your maximum possible bid. This is one area where your real estate agent is going to provide very useful advice.

When you find the home that fits your expectations, you should arrange for a home inspection by a certified professional. This will tell you what sort of repairs need to made for the house to be free of insect or weather damage, for example. Other areas that should be examined include: electrical, plumbing, ventilation, structural integrity (for example, the condition of the roof or foundation) and the quality of appliances and insulation. You have the right to a home inspection after making an offer and should take the time to accompany the inspector to ask any pertinent questions.

After considering the results of the inspection, it is your option to either renegotiate the offer if problems are discovered or to arrange for the homeowner to repair any difficulties. You may also opt to take on the repairs after the purchase is concluded. Whatever your decision, buy with eyes wide open concerning the condition of your potential property.

You have now taken care of considering the location, making an offer and arranging for an inspection of your possible first home. Next time we will consider the final steps of buying your house. The purchase agreement and the closing process dominate this phase. What should you know ahead of time to successfully close the deal?