Informed Buyer: 13 Market Considerations to Assess Before Buying
Depending on the size of your new purchase and whether you’re moving from an apartment to a single-family home, it might also take significantly more energy to heat and light up. And if you have been piggybacking on a neighbor’s wifi without permission, or you are no longer going to be able to use your roommate’s Netflix password, those are both costs you will want to consider before you decide to buy your own place. Some utility companies, like electric, water, and gas providers, can give you a ballpark range of what to expect to pay if you provide them with the square footage. Some will even show you the past billing history of any address you’re considering buying, if the seller agrees to give you access to that information. Pinpointing your internet needs is usually easier, but do not forget that you might need more bandwidth for a bigger house with more devices. Consider your commute Another expense that might grow over time is the price of the gas you put in your car, which depends on all sorts of factors entirely beyond your control. So even though moving to a place on the outskirts of town or in the suburbs might be a better deal for your bottom line when it comes to housing, you could end up spending more money on gas than you anticipated, wiping out any savings you hoped to accrue. Before you decide on a house or even a neighborhood, think about how you’ll get to work. Maybe your new place is on a reliable public transportation line — great! Do you already have a bus pass that you can use, or will you have to buy one? Does your employer have any discounts or deals that you might be able to use? Those who spend a lot of time traveling will also have to think about the cost of getting to and from the airport, whether you’re driving yourself or using a ride share. And if there aren’t any grocery stores nearby the house you want to buy and you don’t have a car, that could be something to consider before you put an offer on the place. Factor in upkeep and homeownership costs One of the best things about renting is that if a pipe bursts or your electricity fizzles out suddenly, you can call your landlord and then wait for the repairs. (Well, that part isn’t so much fun — but you don’t have to pay for it yourself.) But if the water heater breaks or your roof starts leaking in a house that you own, guess what? You’re on the hook for fixing it, and that could wipe out your savings or mean you’re going to be putting a big, sudden expense on your credit card. Do you have the ability (or available credit) to handle one of those major expenses if it emerges? Some are obviously more urgent than others, of course; you might be able to live without hot water, even if you don’t want to, but a leaky roof could cause a whole host of other problems that you’ll also have to fix, so you can’t always put every home repair off until you feel comfortable paying it. Think about your future employment prospects You may be extremely happy in your job today, but in this day and age, it is highly unusual for employees to stay at the same company for a decade or more. Of course, you can always sell your house whenever you’re ready to move on to a new employer — but if you’ve been living in the house for less than two years, then you will have to pay capital gains taxes on any sale, which could potentially wipe out any profit you might have otherwise made. So even if you do not see yourself moving on from your current job anytime soon, it is a good idea to research the employment opportunities in the area before you commit to buying a house. That way your career will have room to stretch and grow while you continue to accrue equity in your house, and you can feel confident that you have the options you need to be happy at work and at home. Get details from the Chamber of Commerce The local Chamber of Commerce can be a wealth of information about any community where you are thinking about buying a home, and it’s definitely worth your time to do some research around local businesses in your area. Have there been a lot of businesses closing in the area — or opening? Does the chamber seem healthy in general? Does it host community events and offer opportunities for businesses to sponsor things like little league teams? And what is the mix of businesses in the area? Are there more restaurants than bars or vice versa? What kinds of retail stores are thriving? These little details can help you decide whether one neighborhood will be better-suited to your lifestyle than another, and can also give you an idea of the area’s future growth opportunities. Research future development Some of the best real estate investments can be found in communities where development hasn’t arrived yet — or perhaps where it’s started but has yet to kick into full gear. To determine whether the area you’re considering is growing, you can look at both the Chamber of Commerce or the local city and county permitting office. Ask if there have been any permit applications for new shopping centers or condo or apartment developments, and if you can, get a sense of the timeline for those additions. You might also discover that a new rec center or swimming pool is currently in the works and be able to get your foot in the door in an up-and-coming area before it really starts to boom. Uncover any environmental issues Thankfully, these tend to be rare in this day and age, but you definitely don’t want to buy a house that’s adjacent to a nuclear power plant or subject to landslides without knowing about it first, so you can negotiate the price. Whether it’s a natural disaster like a wildfire, hurricane, earthquake, or flood (FEMA has some good data around where these have been most prevalent in the past), or whether it’s a man-made issue like the water crisis in Flint, Michigan, or a waste spillage from a nearby plant, you definitely want to know what potential hazards exist near or around the house you might want to buy before you make an offer. The decision to buy a house is a big one, and it should depend on many different factors. If you have done your research and you are still not sure whether it makes sense to start shopping, talk to a Real Estate Advisor | REALTOR from Martin Real Estate Advisors Group | United Real Estate. A good accountant and trustworthy real estate agent can give you a solid understanding of what a home purchase might mean for you, and can also help you navigate any pitfalls.