If you want to buy a home, but aren’t sure if your budget can handle soaring real estate prices, we’ve got good news. There are things you can do to stretch your buying power. With the help of your real estate agent – and these 10 tips – you can become a savvy home buyer without breaking your budget. We’ll also tell you how to save thousands on your purchase!
1. Get pre-approved for your home loan. This means, fill out a loan application and go through the process of securing financing. That way, when you’re ready to seriously evaluate real estate, you’ll know exactly how much home you can afford. And you can prove to a seller that your offer is sincere. If you don’t know who to call or where to get started, talk to your agent at Nesbitt Realty and we’ll help you get started!
2. Explore creative FHA, VA and VHDA loan options. During the home loan pre-approval process, ask about ways to get creative with your financing. Low down payment options, first and second mortgage combinations and first time buyer programs might help you afford more funding. Ask about a VHDA loan or an FHA loan. If you’re prior military, ask the loan officer about a VA loan. You may find that using one of these options buyer is actually cheaper than renting!
3. Sell your existing home first. Although selling your existing home before finding new real estate to buy can cause a little anxiety, any worries will be offset by your ability to make an offer with cash in hand. Contingent purchases are not the best when negotiating to buy a home. Having your financing in order and your bags packed will give you the advantage in a competitive market.
4. Seek out vacant real estate. The longer a house has been empty, the greater your negotiating power will be. Perhaps a seller’s job has transferred him out of the area. Or maybe a family purchased a new home before putting their existing one on the market. In any case, a vacant home could be just the deal for a savvy home buyer, so have your realtor look for vacant property in your preferred neighborhoods.
5. Find a fixer-upper. If you’re handy with a paintbrush, a toolset and gardening equipment, consider buying real estate in need of some work. Property that lacks curb appeal needs minor handiwork or the yard overhauled could end up being the home of your dreams for a price you can afford. You just need to look beyond the ho-hum to see the potential of a cosmetic fixer.
6. How about buying a short sale? One person’s loss could be your gain if you buy a short sale. There are a number of pitfalls to avoid when considering a short sale. Ron Ginyard is a Certified Distress Property Expert and he is an excellent resource if you’re considering a short sale.
7. Consider a dated look. Often homes with a dated look are priced lower than newer construction and refurbished homes. There’s rarely a bidding war for a home with out-of-style Formica, shag rugs and olive appliances. Look for clean and functional properties with a slightly-dated decor. If the home has the necessities of life, you can slowly buy new appliances and perform updates to bring the home back into fashion.
8. Buy the cheapest house in the best neighborhood. You have your heart set on a specific – and expensive – neighborhood. Maybe it’s the schools that you’re interested in. Or perhaps it’s the close proximity to downtown or the waterfront. In any case, a budget-savvy buyer will look for the least expensive home for sale in the neighborhood. If you’re not in a hurry, you can even play the waiting game to see what properties come on the market. Your real estate agent can be a real asset in this case by investigating potential sellers.
9. Shop on Nesbitt Realty. Did you know that Nesbitt Realty offers a rebate to every single buyer in Northern Virginia? Use us and save thousands. (Read more here.)
Buying real estate without breaking your budget will require research and compromise. On moving day, however, you’ll have the satisfaction of knowing that your homework paid off.