Five Factors That You Must Not Overlook When Searching For A Home
- By Greg Fleischaker
- Published 09/19/2011
- Buying
- Unrated
Homes are bought for either the owner's use or as an investment. The first category is need based. These people want homes to live in and are looking for a home that will meet their needs, priorities and lifestyle. The second category buys a home for investment purposes. The investor is looking for capital appreciation and rental income. So do these different priorities make the home selection process totally different for these two groups?
Though their immediate priorities may appear to be very different, there is a lot of overlap between the requirements of these groups and so what is applicable to one is applicable to the other to a great extent. Everyone wants the value of their own home to appreciate and no investor wants to put money in a home which will not appeal to end users or which cannot be rented or sold easily. Here we are focusing on the first category that is the group that buys the home with the intention of living in it but many of these considerations will apply to the investor category as well. There are five important things to keep in mind while buying a home.
The first one is whether to go for a relatively newer home which will cost more but will need very little remodeling, or go for an older model home which will have a lower price tag but will need considerable remodeling and refits to get it to meet your requirements.
The costs and time taken for the remodeling process can vary depending upon how much work is actually required. Often this is underestimated, so you should not go for this option without knowing what you are getting into. The best thing would be to get a proper estimate from a professional who is into the home renovation business.
The second issue to be considered is the age of the home that you wish to buy. The older the home is, the better the price tag. The flip side is that older homes come along with a higher number of potential problems. These problems can be minor and easily fixed or could be very major and could cost a lot of money to fix. It all depends on the quality of construction and how it was maintained in the past, and so it is importan
t to get it inspected. If you get proper inspections done by professional home inspectors then it is usually possible to get a good home at a bargain price.
One thing that should be considered when buying an older home is the usage history. Was it used by the owners or was it rented out. Owners typically take great care of the home that they live in. Homes which have been rented out to multiple tenants over long periods of time tend to get their share of neglect from the owners and rough use by the tenants.
The type of home that you plan to purchase is the third factor. Do you want to go for a standalone home, or an apartment, or a condo, or some other suitable home? It all depends upon the size of your family and what your requirements are not just at the moment but say for the next five years. The average ownership period of a home is around eight years. So even though it always looks like a life time decision when you are buying it, it usually is not the case.
The next thing to consider is the location. Again location preferences can vary depending upon the life stage that you are in. People who are older can afford to go to quieter greener neighborhoods which may not have all the conveniences across the street, but will be more peaceful. If you are younger then the priorities will focus more on day to day necessities. The length of the commute to work, and the availability of facilities such as schools and hospitals nearby are very important considerations. The other things to consider are the availability of recreation facilities and the type of people who live in that area. Safety and crime rate is also an important consideration. If you can't live without pets then checkout whether there are any restrictions on keeping them.
Finally consider the capital appreciation potential. Make sure that the home that you are going to purchase is likely to keep pace with the market and grow in value at the same pace as the other homes in the locality. This is important because as mentioned before no home is a life time investment these days when requirements and priorities change over a period of time. The capital appreciation factor is important to ensure that you don't have to pay more than a reasonable extra amount when you want to relocate or make that switch to another home.
Though their immediate priorities may appear to be very different, there is a lot of overlap between the requirements of these groups and so what is applicable to one is applicable to the other to a great extent. Everyone wants the value of their own home to appreciate and no investor wants to put money in a home which will not appeal to end users or which cannot be rented or sold easily. Here we are focusing on the first category that is the group that buys the home with the intention of living in it but many of these considerations will apply to the investor category as well. There are five important things to keep in mind while buying a home.
The first one is whether to go for a relatively newer home which will cost more but will need very little remodeling, or go for an older model home which will have a lower price tag but will need considerable remodeling and refits to get it to meet your requirements.
The costs and time taken for the remodeling process can vary depending upon how much work is actually required. Often this is underestimated, so you should not go for this option without knowing what you are getting into. The best thing would be to get a proper estimate from a professional who is into the home renovation business.
The second issue to be considered is the age of the home that you wish to buy. The older the home is, the better the price tag. The flip side is that older homes come along with a higher number of potential problems. These problems can be minor and easily fixed or could be very major and could cost a lot of money to fix. It all depends on the quality of construction and how it was maintained in the past, and so it is importan
One thing that should be considered when buying an older home is the usage history. Was it used by the owners or was it rented out. Owners typically take great care of the home that they live in. Homes which have been rented out to multiple tenants over long periods of time tend to get their share of neglect from the owners and rough use by the tenants.
The type of home that you plan to purchase is the third factor. Do you want to go for a standalone home, or an apartment, or a condo, or some other suitable home? It all depends upon the size of your family and what your requirements are not just at the moment but say for the next five years. The average ownership period of a home is around eight years. So even though it always looks like a life time decision when you are buying it, it usually is not the case.
The next thing to consider is the location. Again location preferences can vary depending upon the life stage that you are in. People who are older can afford to go to quieter greener neighborhoods which may not have all the conveniences across the street, but will be more peaceful. If you are younger then the priorities will focus more on day to day necessities. The length of the commute to work, and the availability of facilities such as schools and hospitals nearby are very important considerations. The other things to consider are the availability of recreation facilities and the type of people who live in that area. Safety and crime rate is also an important consideration. If you can't live without pets then checkout whether there are any restrictions on keeping them.
Finally consider the capital appreciation potential. Make sure that the home that you are going to purchase is likely to keep pace with the market and grow in value at the same pace as the other homes in the locality. This is important because as mentioned before no home is a life time investment these days when requirements and priorities change over a period of time. The capital appreciation factor is important to ensure that you don't have to pay more than a reasonable extra amount when you want to relocate or make that switch to another home.
Greg Fleischaker
To learn more about Louisville homes for sale and data analysis of the Louisville real estate market, visit www.GregFly.com where Greg Fleischaker breaks down weekly sales data for the city as well as many surrounding neighborhoods, such as the Highlands, St. Matthews, Prospect and Anchorage, to help buyers and sellers prepare themselves for an upcoming real estate transaction.
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