You have been looking and hunting for that "deal" in this buyer's market -- and you think you've found it -- but have you? Understanding what constitutes a Good Deal may be more personal than you think. The thrill of the search and looking at real estate can put your head in a spin and your heart may become attached to a certain home. However, when you get to the point of putting in an offer, step back and make sure you have a clear mind about the property -- not just the price.
Price Is Not Everything While the price of the home may be attractive, it isn't cheating to ask why it is so low. Is the home in need of repair? Are there permits required to make those repairs? How extensive are they? Can you live in the dwelling while those repairs happen? Are you capable of doing the repairs yourself, or will you hire someone to accomplish the tasks? Do you have the constitution to deal with the repairs -- are you able to make decisions, do the research, hire the right people, and have the tools/time you need?
While price may be a driving factor, in real estate it is often location. Did you find a good price but in a location that you are compromising? If so, this is one factor you cannot change. Think hard if you are compromising on this one. Commuting a long distance takes time and gas, which can be figured as dollars, making that low price not so low.
Look at features of the home, landscape, location or neighborhood that make it uniquely suited for you, or that affect the price. Understand these before you buy. Even if you never plan to have children attend the local schools, you still might want to know about the schools in your area - it is part of the entire profile of the property you are buying. Look at hospitals, bus routes and other aspects of civil services in the area, too. Some people want to be close to everything, some prefer to be off the main flow - but most importantly: does the profile of this property feel right for you?
When The Price Is Not The Price
A large home with poor insulation, an aging furnace or heating/cooling system, older windows, roof in need of repair or other "big ticket" needs can quickly affect your budget after you buy. Have an expert evaluate features like pools and hot tubs, as these attractive perks might not be in good repair or cost more than you expect to operate and maintain. And remember: pools need to have adequate fencing and safety features. If you need to add them, it could be expensive.
Smaller homes might require that you rent office or storage space off site -- also affecting your budget. And don't forget property taxes, homeowner's or condo fees -- these are annual expenses that must be considered. Don't forget to look at driveways and sidewalks, if you are responsible for these. Often overlooked, replacing or repairing sidewalks that present liability issues might be a pricey fix.
Issues around location can also lead to hidden costs. Longer commutes, poor or inadequate parking, security systems for homes and cars, or costs to keep the home at the level of the neighborhood can add to your expenses. If you plan to work from home, or have clients into your home office, be certain that your business is welcome in the neighborhood. Some cities or communities have strict regulations about running a business from your home. If you cannot use your property in the way you want or need to, then it might not be good for you.
Know Thyself: The Key To Knowing A "Good Deal"
Understand how you deal with stress. If you can't handle the stress of a remodel or complicated/lengthy transactions, getting a house that is in foreclosure or requires extensive work might not be such a good deal. Permits require understanding codes or hiring contractors who do -- but ultimately the homeowner is responsible if there is a permitting issue. Moving itself is stressful, so consider when your "good deal" brings any extra stresses with it. Some people thrive on getting a good deal and doing home projects, so they have extra energy to deal with such things. Know if this is you.