How to Find Your Dream Home
One of the most important steps in setting your budget is getting a mortgage preapproval. This pre-approval, which is in effect for two or three months, states that you are qualified to borrow a certain amount from the bank under specific terms.
When you’re pre-approved for a mortgage, you’ll have a clearer picture of what you can afford to spend on a home. It will also make you a better candidate after you’ve made an offer on a home, if you find yourself in a multiple-offer situation.
In order to get pre-approved, you’ll need to bring information about your income and assets to a lender. They will also check your credit score, and ask about how much you have saved for a down payment. Then, they’ll let you know the loan you can expect. A pre-approval is not binding, so feel free to talk to a few different mortgage lenders and compare terms.
The pre-approval process may seem like a lot of stressful paperwork when all you want to do is get out and see some houses, but it will set you up for success in your home search.
If you’re moving from an apartment to a house your utility bills will likely increase, since you’ll be heating, cooling and lighting a larger space. If you have been renting, these costs, as well as your water bill, may have been included in your monthly rent. Be sure to include estimates of utility costs into your calculations when you determine how much you can spend on your new home. You’ll also want to factor in moving costs, needed renovations or repairs, set-up fees for Internet and TV service and costs associated with taking care of the exterior of the property.
2. Figure out your must-haves and deal-breakers
When you first start thinking about the home you want, it’s easy to dream big. When you begin listing all the things you’re looking for, your home may require a spacious guest bedroom, a finished basement, a kitchen with the latest features and a massive landscaped yard. And if you’re house hunting as part of a family, everyone may have their own priorities.
But try taking a step back — which elements are most important to you, and which are things you want to have but could live without? Maybe you can redo the kitchen once you move in, or you’d trade that yard for proximity to a beautiful public park.
Now, make sure you know what aspects of a home are absolute dealbreakers. If you’ve lived next to a noisy highway for years and already know you won’t do it again, don’t even bother putting homes that fit that description on your tour list.
To ensure you have a reasonable set of must-haves and deal-breakers, take everything you’ve listed from your dream home brainstorm and rank them in order of importance. Then, you’ll know your priorities when you begin touring homes.
3. Consider your neighborhood options
Before you start looking at individual homes, take some time to get to know the neighborhoods you’re considering. If your circumstances allow, take a day trip to each area you’re most interested in. Don’t just stay in your car — get out and take a walk around. Figure out where you’d likely go for groceries, shopping or a meal out, and get a sense of what the trip is like. If you are moving with kids or intend to have them in your new home, do some research on the schools and on nearby places they can go for sports, arts or other after-school activities.
You don’t want to limit your options too tightly at this stage, but getting a sense of different neighborhoods you may consider may help you hone your priorities. Looking back at your list must-haves and deal-breakers is a good way to determine whether a neighborhood is the right fit for you and your family. And, knowing what you like about one area or another will help your REALTOR® recommend additional places to broaden your search if needed.
4. Work with a REALTOR®
As you start your house hunt process, you’ll soon realize it’s a lot to manage on your own, especially if you’re moving to a new area. A REALTOR® can help you gain access to any of the homes on the market that match your needs, provide guidance throughout the buying process and serve as your advocate in negotiations.
When looking for a real estate professional to help you find your dream home, be sure you choose a REALTOR®. Anyone with a real estate license can be a real estate agent, but REALTORS® are held to higher standards. They follow a strict Code of Ethics set by the National Association of REALTORS®. This code protects homebuyers and sellers by guiding how REALTORS® represent their clients in every step of the process, ensuring all parties are treated fairly and with respect.
In addition to meeting this higher standard, your REALTOR® can contribute:
REALTORS® work locally, and bring firsthand knowledge of the market to your home search. Sure, anyone can research home listings online, but a local REALTOR® will bring years of experience in a given neighborhood to help you find homes that fit your criteria. They can advise you on the best time to start looking based on the local market, and what to consider when you make an offer.
REALTORS® have access to the Multiple Listing Service, which provides the most accurate and up-to-date information on homes in your area. With it, your REALTOR® can find you homes that fit your needs and help you negotiate throughout the buying process.
Depending on your needs, you may want to work with a REALTOR® with a certain specialty. Through Associations like Mainstreet Organization of REALTORS®, REALTORS® have access to continuing education opportunities in real estate. Many become certified in specialties like military relocation or working with homes with environmentally-friendly features. When you work with a Mainstreet REALTOR® with the relevant certification, you know they have experience finding exactly the type of home you're looking for.
Ready to start your home search? Hire a Mainstreet REALTOR® today and take the first step toward finding your dream home.