House hunting tips and House hunting advices
House hunting is the process of finding and viewing properties to buy your dream home. It sounds fun, but the process is not always easy, especially for first-time homebuyers.
According to the National Association of Realtors, 56% of homebuyers say finding the right property or house hunting is the most difficult part of the home-buying process. That’s surprising, isn’t it?
You may have thought it was getting the mortgage, right? The thing is, getting the mortgage is not a problem when you buy the right property at the right price, and all the boxes check out.
And it’s not just first-time home buyers; people of all ages are finding it difficult hunting for a house.
House Hunting Checklist
This checklist helps you in the house-hunting process, so that you can get the most for your money, avoid expensive mistakes, and find the right home.
So, why is finding the right property the most difficult part of the home buying process?
Well, buying a home is not like buying a cell phone or even a car. You have to know what to look for and what to avoid before even thinking of going out to view homes. Otherwise, you risk making an expensive mistake that can ruin you financially.
Here is a shortcut that will make things easier.
Ask yourself these questions:
Do I like the neighborhood?
Does the home meet my requirements now and in the future (5 years minimum)?
Is the property a good investment?
Can I comfortably afford to pay the mortgage?
Asking yourself these questions forces you to think critically about the decision you’re about to make. The issue is, many home buyers get emotional and don’t pay enough attention to the things that matter.
Luckily for you, I have prepared the ultimate house hunting guide; this guide will help you make finding the right home an easy process and prevent you from making expensive mistakes along the way.
Things to do Before You Start House Hunting
The home buying process does not start with going out to view homes so that you can pick the best one. That’s not it. There is a lot of preparation work to do, which will save you time, money, and your sanity.
Here are the steps you’ll need to take before you start shopping for a home:
1. Find out how much house you can afford.
You wouldn’t go to a market without making sure you have enough cash, right?
The same goes when it comes to looking for a house. It is critical to determine how much house you can afford before you go out looking for homes.
A great way to find out what you can afford is using our home affordability calculator. This will give you a good idea of the type of home you should be looking for.
Remember, the last thing you want is to buy a home you cannot afford or stretch your finances to financial ruin.
Read More : How Much House Can I Afford?
2. Save for the required down payment
First, start with a goal in mind so that you’re clear about how much down payment you will need. For instance, if the home you want has a price tag of $500,000, and the minimum required down payment is 5%, then you need $25,000 for a down payment.
Second, is to set a timeline. Ask yourself the question, how long would it reasonably take to save for the down payment? You should aim to save no less than 10% of your annual income every year.
So, if you need to save $25,000 and assuming an annual income of $70,000, that means you should save $7,000 per year for about 3 and a half years, or $583 per month.
Read More: What’s the Required Down Payment on a House?
3. Get mortgage pre-approved
The two main reasons to get a mortgage pre-approval before the house hunt are:
- To show sellers, you’re financially capable of purchasing the property.
- To make sure you don’t make offers to homes you cannot afford
Sellers view buyers who are pre-approved as more serious buyers and may even decide to accept lower offers who pre-approved buyers because it means those buyers are financially fit to complete the transaction.
To learn more about the home buying process, check out how Home Buyer’s Guide.
4. Hire the best buyer real estate agent you can find
Hiring the best real estate agent you can find is your secret weapon in the home buying process. This is an important decision so forget about hiring a friend realtor or calling the number on the biggest billboard down the street.
Interview at least 3 – 5 of the best realtors you can find in the area, ask questions, and choose the agent that you best see yourself working with.
Tips for Hiring a Realtor
This template will help you learn how to identify the best real estate agents vs. the bad ones. Having a pro realtor in your corner can mean the difference between a successful purchase or a deal gone bad.
Identify Your Must-Haves and Nice-to-Haves
Finding the perfect home can become a challenging endeavor when you don’t have a clear picture of the things that are an absolute must and the things that you can do without.
Looking for a house begins with creating a list of your must-haves and nice-to-haves. This focuses the search on the important things, which will prevent you from wasting time viewing homes that are not suitable as defined by your search criteria.
Here are some tips to help you determine your must-haves and nice-to-haves:
You can renovate the house, but you can never renovate the neighborhood; thus, first, pick three of your favorite/chosen neighborhoods and then look for homes only in those areas.
Determine the non-negotiable accommodations. The most common must-haves are the number of bedrooms, number of bathrooms, home-style, square footage, whether there is a finished basement, and what the condition of the home is.
Pick your desired lifestyle. Some home buyers like homes that are near a park, sports facilities, restaurants, or amenities. If you like to host BBQs in the summer, you’ll want a home with a good-sized backyard. Or, if you like cooking, having a functionally, well-spaced kitchen makes it to the list.
Focus on the things you cannot change. For example, if a home has older appliances, that’s not a deal-breaker because those things can easily be replaced. Your must-haves list should be made of only permanent items or things that cannot be changed, such as the structure of the home.
Don’t forget about your budget. If there is a big discrepancy between your must-haves and what you can afford, go back to the list to find areas where you could compromise on.
Know Your Budget Before Going to View Homes
Many homebuyers fail to realize that the costs of homeownership go beyond simply paying the mortgage. There will also be costs on property taxes, mortgage insurance, home insurance, utility costs, house maintenance, and more.
Make sure to buy a house you can comfortably afford instead of maxing out on the purchase.
When you buy more house than you can realistically afford, the expenses eventually catch up with you; that’s when uncle debt moves in the basement and then creeps into the living room until you get kicked out. No joke!
So, guess what? Before the house-hunting begins, you should create a household budget. A budget helps you manage your money so that you understand how much money you’re spending and properly plan for future expenses, including all homeownership costs.
To gain access to easy-to-use templates that will help you plan anything from weekly meals to a travel saving plan, or a monthly budget, check out our Budgeting Binder Planner
How to find the right house: House Hunt
The house hunt now takes place online. At least that’s how you get to shortlist the properties you want to view in person. According to the National Association of Realtors, 50% of home buyers first found their home online.
Here is a complete breakdown of how home buyers find the home they purchase:
Source Of Research: The National Association Of Realtors.
What this means is that you should also leverage the use of technology by finding homes online. Ask your realtor to set you up with daily email alerts letting you know the properties that go on sale in the neighborhood you want.
By starting your search online allows you to efficiently get a sense of all homes available for sale in the area you’re looking for. To search for homes online, you can use websites like Realtor.com, Zillow, Zoocasa, or using MLS links your real estate agent provides.
Aim to be strict and thorough with the properties you see. Fear can be your ally – practice it.
I am not trying to be negative here, but fear can be a good house-hunting strategy. When you’re fearful of making a wrong decision, you will make sure everything checks out before deciding to go all-in on a house.
Narrowing Down Your Home Search
The house hunt has three main components:
- Identifying your must-have & nice-to-haves
- Narrowing down property choices to view in person
- Touring properties until you find the perfect one
By looking for homes only in the neighborhoods you have preselected, you’re half-way there. The next step is fun, and it involves matching you’re the items on your house hunting checklist (wish list) with the features from matching properties.
What to Look for When House Hunting
When viewing homes, most properties you see won’t be what you’re looking for; some areas are more important to inspect than others.
For example, the kitchen, the bathrooms, and the basement the two most costly areas in a home, which means you have to pay special attention to those areas to avoid being left with expensive repairs later on.
Here are more key things to look for when viewing homes:
- The neighborhood. Do the neighbors take good care of their homes? This could indicate whether the neighborhood is in a growth or decline stage.
- Smell (a damp or musty smell could be a sign of mold in a home). And, if there are many air fresheners and/or candles, that could mean the seller is trying to hide something.
- The home’s curb appeal. It’s not just what’s inside that matters; how the home looks from the outside is an important factor that adds to the home’s value.
- The size of the house and the size of each room. This one is obvious – The rooms must be big enough to fit your furniture and lifestyle.
- The kitchen/bathrooms/the basement. Again, these are the most expensive areas in a home.
- Condition of the interior, exterior, roof, HVACC, and appliances
I cannot emphasize this enough – it’s very important. DO NOT be swayed by the décor! When the existing owners move out, the décor moves with them; you’re left with the home. So it’s the home you have to pay attention to, not the décor.
Find Out Recent Sold Prices of Comparable Homes
Sellers choose the pricing strategy according to how the market is presently performing.
If it’s a buyer’s market, sellers will typically list properties at a price that is close to what they want; however, if you’re in a seller’s market, the sellers may choose a low price to generate multiple offers.
Whatever the price homes are listed for, what’s relevant is the sold prices of similar nearby homes.
Here are some smart questions you should ask to determine if a home is listed too high or too low:
- How long has the home been on the market?
- How much did the current owner pay for the property?
- What price have other similar nearby homes sold for?
Ask your real estate agent to prepare a list of comparable homes recently sold in the area. That way, you can compare how much other buyers paid for similar properties vs. the list price of the home you want to buy.
You will need to adjust your offer price up or down depending on the comparable prices of other similar sold homes.
11 House Hunting Tips
Buying a house is an emotional process. With so much money on the line, it shouldn’t be, but it is. Why? Understandably so because that’ll be the place you call home.
These 11 tips will make the house-hunting process easier and less stressful for you:
1: Choose the neighborhood before choosing the home
Your neighborhood’s schools, nearby parks, schools, restaurants, and shopping stores determine your lifestyle. Neighborhoods with good nearby schools, parks, restaurants, and shopping stores lead to stronger home values.
Many homebuyers do this process in reverse.
First, they find a house that they like, and then they start looking into the neighborhood. The chances are that if they like the house, they will compromise on the neighborhood. That’s a mistake.
2: Decide on Your Must-Haves and nice-to-haves
Checklists are your friend during the house hinting journey; start the process by creating a list of features the home must have and the add-ons. This could be the number of bedrooms, the price, proximity to work, quality of schools, and more.
Keep your checklist with you when touring homes so that you don’t get distracted looking at homes that do not match what you’re looking for.
3: Take Notes
Details will become blurry after viewing multiple homes; without notes, you might end up remembering the beautiful kitchen, but forget the small master bedroom.
Print out your house hunting checklist above and bring it with you to the home tour so that you can take notes for every house viewing.
4: Ignore the décor
Most homes for sale are nowadays professionally staged. While home staging makes properties look nice, it also helps to hide flaws. This is why I always recommend home buyers to visit a home they like no less than twice.
The first visit might be exciting, and emotions start to run high; there will be things you miss in the first visit. The second visit should focus on finding the flaws. All homes have flaws; find them.
By ignoring the décor, you shift your mindset from an emotional-type buyer to focusing on the areas of the home that matter. You can also use the home’s flaws as a negotiation tool to get a better price.
5: Spend at least 30 minutes viewing each home
Some buyers fall victim to FOMO (Fear of Missing Out). They see the home online, then they visit the one quickly and say, “Let’s make an offer before someone else does.”
That’s reckless behavior that can lead to home buyer’s remorse. Remind yourself that owning a home is a long-term commitment, not a flint.
Test everything. Turn on the lights, the water faucets, flush the toilet. Once you have determined if the house is a real contender, visit the home a second time, but this time focus on finding flaws. You’ll find them.
7: Don’t stretch your budget to get an overpriced home
After looking at a few homes, buyers may think they’ll never find a home that fits their budget. Don’t give up! It’s a matter of time, but you’ll find the right home. So, do the math and stick to your budget.
Lenders often approve mortgages for a higher amount than you can afford. That’s a shocker, but it happens. The thing is, lenders do not include living expenses when approving a loan. So if you’re spending $300 per month on eating out expenses, that doesn’t go into the lender’s affordability calculation.
That means you should rely on your budget rather than the amount of mortgage you get pre-approved for. Or, if you’re pre-approved for say $600,000, aim to buy a house for less than $600,000 rather than maxing out on the allotted amount.
8: Look for cracks or stains on the walls and ceiling
Cracks on the walls may mean problems with the foundation; that a big red flag. Similarly, stains on the ceiling could mean water leakage into the attic. That’s an expensive repair.
This is why you have to take your time during each home viewing so that you can be thorough in looking for flaws the home has. Yes, there will most probably be a home inspection later on, but checking for these things will save you time and money.
9: Never buy the best house in the neighborhood
Have you noticed malls or shopping centers have a couple of anchor stores and a bunch of smaller stores? The anchor stores are the ones that attract most of the attention; once the buyer is in the mall, the smaller stores get the benefit.
It works the same way with real estate. The best homes in the neighborhood help bring up the value of other less desirable nearby homes.
From an investment perspective, there is more upward potential when you buy the worst-looking house on the street vs. buying the best one. You don’t want to be stuck later on, trying to sell a $700,000 house in a $600,000 neighborhood.
10: Check out the walk score
The house’s walk score can affect your wallet. In other words, being close to stores, restaurants, and your work means you spend less time traveling to those places.
So, before deciding on the house you want to buy, check out the walk score as this will impact your lifestyle.
Here is how you can interpret walk scores:
- 0-24: Car-Dependent. Need to drive to all
- 25-49: Car-Dependent. Need to drive to most
- 50-69: Somewhat Walkable. It’s possible to walk to some
- 70-89: Very Walkable. It’s possible to walk to most
- 90-100: Walker’s Paradise. No car is required to run errands
11: Ask questions before, during the house hunt
Don’t be shy – go ahead and ask a lot of questions when viewing each home. Your real estate agent might not know all the answers, but ask him/her to get you the answers.
Here are the most important questions to ask when viewing a home:
- How old is the roof?
- How old are the appliances
- What’s included in the price? (Does the price include fixtures and appliances?).
- What renovations have been done to the house, and were permits obtained?
- Has the home been flooded?
- Is there mold in the home?
- Has there ever been a pest infestation in the home?
I hope you’ve enjoyed these comprehensive house-hunting tips for first-time homebuyers + checklist. Buying a house is a significant purchase, but you’ll do well if you follow these tips.
On this website, you will find many additional guides, tools, and tutorials that can help you become a savvy home buyer.
The house-hunting process is not only about what you should do but also about what you should not do. For a detailed guide of mistakes you should avoid, check out my article House Hunting Mistake You Should Avoid.
Happy house hunting!
Ready for the next steps?
To learn more about the home buying process step-by-step, check our New Home buyers Online course.
Click Here: Home Buyer’s online course