On the top of the list for the biggest household expenses is housing. Regardless if you have a mortgage or rent your primary residence, the estimated expense for housing for an average household in the United States is 32% of income - of course, it varies up or down based on your household's circumstances. In any case, I believe that when clients come to me to purchase a residential or commercial property they are smartly investing in their financial future. This also means that more Americans are finally recognizing how critical it is to keep their housing and real estate investing affordable.
HOW MUCH REAL ESTATE CAN YOU COMFORTABLY AFFORD?
Don’t bite off more HOME than you can chew.
For most real estate buyers the answer is a house or investment with a purchase price of no more than 3x their annual income. The cost of real estate ownership includes much more than the monthly mortgage payment. You have property tax, insurance, maintenance, repairs, marketing for investment properties and legal expenses that add up. Typically these costs can run 3% to 5% of the price of your home each year. These are all essential things to consider. This is why I ask my clients to seek professional advice from a mortgage broker, financial advisor or accountant on how much they can comfortably afford before going to view properties.
Oftentimes, a client calls seeking to buy foreclosure properties or a property that requires major repairs. These clients seek to flip a property but do not consider the many factors that have to fall into place to be successful at it. They have never changed a leaky faucet, have never installed sheetrock or unclog a toilet. They often suck at painting as well. Note: the peeling off paint, quirky lines, paint splashes gives away an inexperienced painter. This symbolizes that they have to rely on contractors to get the job done and if you have dealt with contractors in the past, you have probably experienced first hand how much fun that is. As time goes by into a renovation project, flipping buyers realize that they have to up-keep their expenses for a property that is not producing any income or they have to live in a property that is not ready while renovations take place.
Real estate investors and home buyers also find that getting approved by a lender could be a stressful process. Not knowing how much house you can afford before placing an offer could be a very costly mistake for real estate buyers.
REAL ESTATE FLIPPING, FORECLOSURES, REO PROPERTIES
Are they worth it? It all looks very good on TV when they flip houses in 1-2 months and make a very nice profit on the sale. Have you wondered how they really do it?
FIRS TIME HOME BUYER
I am an experienced professional expected to maintain a higher level of knowledge of the process of buying real estate. Home buying may seem to be a very simple process: find the house you like, negotiate the price, pay for it and move in. However, there is much more to home buying than just that. There are laws, research, disclosures, inspections, appraisals, negotiations and other requirements that have to be met.
You need to take a break and think about all the questions to ask when buying a house. And as I always tell our clients: “If you have a question, ask it, no matter how foolish it sounds in your own head. There are no such things as stupid questions.” After all, you are making one of the biggest financial investments of your life, so it’s an excellent opportunity to tap into our expertise as real estate agents.
Everyone deserves to own the home or investment property of their dreams, and you can certainly be next. As your real estate agent, I can help you understand and guide you through the process. I am very proud of the work I do for my clients. As real estate professionals, we are committed to treat all parties to a real estate transaction honestly and subscribe to a strict code of ethics.
Location, good local schools, great municipal services, convenient public transportation - these are a small number of factors you may consider when choosing where to live and which home you want to buy. No matter your budget, I can help you find the perfect home for you. As real estate agents, I will be with you every step of the way, from helping you narrow your search to guiding you through the negotiation process and closing the deal.