In This Hot Real Estate Market – Top Tips For Homebuyers
Another day, another flurry of multiple offers. At least that remains the norm for most properties here in the San Francisco Bay Area.
According to Tyson, buyers in this (or any) market should consider three factors before making a real estate investment.
Buyers need to consider how affordable it is as a part of their budget.
Each household must use their own personal circumstances to decide the feasibility of the purchase. Only the buyer knows if they have other monetary commitments that they need to work on first.
Last, new buyers must consider how comfortable they are with making a purchase. If they are not completely comfortable with buying a home, they need to put off a purchase until they are in a situation where it is an affordable option.
In his book, Tyson warned that buyers be careful of solicitors. Even solicitors recommended by your bank can be a bad deal for you financially. As we all know, banks will not always look after your best interests. Do your due diligence.
Consider the potential financial impact of each life insurance plan and hire a good financial planner to help you figure out your budgeting process. If you don’t want to work with a financial planner at this point consider using a free program such as Planwise.
In addition to a financial planner, it remains important to carefully elect a real estate agent or team to work with. We recommend obtaining a referral from a trusted professional.
Expenses and Taxes
Additionally, Tyson believes that families should have at least enough money to cover their living expenses for three months if they are hurt or laid off. During a recession, families should raise the amount of their savings to cover six months of expenses. Too many fall into default when some unexpected occurs.
To ensure that homeowners can afford their new home, they should also look into the property taxes in their area. Sometimes city assessors tax homes at a higher rate (especially here in San Francisco) but homeowners can protest it. Knowing how to contest the protest remains another matter.
According to Tyson, people should be wary of refinancing their home. With interest rates at historic lows, many home owners want to take advantage of the lower interest rates. Before jumping on the refinance bandwagon to sure t figure out how many years it will take before you start saving money and recoup the cost of refinancing.
If you want to prevent your interest rate from rising in the short run, pay your mortgage on time. Most banks offer automated payments. Homeowners who make late payments take a hit to their credit score. Over time, the bank may even raise their interest rate. Save money and sign up for electronic payments. With electronic payments, you will never have to worry about a check getting lost in the mail or forgetting to send in your mortgage.