Buying real estate is incredibly exciting for a number of reasons. Whether this is your first purchase or you are moving on to a different home that better meets your needs, this decision must be made carefully. It’s important to review your goals and priorities before you get started.
Why do you want to buy?
Are you tired of paying rent? Have you outgrown your current home? Would you like a larger yard? Would you rather live in a different area? Do you want to shorten your commute? Is your family growing? Or are you looking to start growing your personal wealth? Considering an income property? Perhaps a vacation home? Whatever they may be, having a clear sense of your reasons for buying will help you choose the right property.
What is your budget?
Are you more focused on overall price, or monthly mortgage payment? Is your paycheck consistent, or are commissions and bonuses a large part of your annual earnings? Are you financing, or using cash? Answering these questions will help you decide on a budget for your purchase. Experts recommend spending between 33-40% of your income on housing, but that can vary greatly from buyer to buyer. Additionally, there are significant tax benefits to home ownership that are worth factoring into your projections. Consulting with a qualified mortgage professional and trusted tax expert should be a priority.