Buying A House Out Of State: Tips And Strategies

Moving out of state has plenty of planning and obstacles involved, but when you add buying a home (and possibly selling a home) to the mix, things get complex. But plenty of people buy homes out of state every year. Lenders and real estate agents have experience with buyers moving across the country or state lines.

In this article, we’ll show you how to buy a house out of state, and we’ll provide some extra tips and strategies to streamline the process.

Yes, you can. It’s very common to buy a house out of state. Just because it’s common, however, doesn’t mean it’s easy. When compared to moving down the street, there are a few extra hurdles that make buying a house out of state harder. Fortunately, there are certain steps you can take to make the process easier.

Let’s go over how you can research, plan and strategize to make the process easier for you.

There are many reasons people move out of state. They could be moving for a new job, to be closer to family or to experience a new place. Whatever your reason, the process of your move shouldn’t take your focus off this big life change you’re going through.

That’s where some knowledge and strategy upfront can make the whole transition easier for you. Before you jump right into your home search, set yourself up for success with these tips.

Assess Your Financial Situation

Before you pick out your new home or make a home purchase, it’s crucial to assess your financial situation. You should have a solid idea of what you can afford by factoring in costs like a down payment and closing costs.

Property values and buying expenses can vary depending on the location, so it’s essential to know how far you’ll be able to stretch your money. When assessing your finances and funds, you’ll need to measure your:

• Net worth
• Income
• Savings rate
• Debt-to-income ratio
• Credit score
• Retirement fund

While a mortgage lender will be able to walk you through the process, it’s important to know your finances independently to make a decision that’s right for you.

Research The Area And Cost Of Living

When you start the home buying process, you need to research where you’ll be living. Look at neighborhoods in the city and research different suburban areas. Consider looking at the school districts and crime rates. You may also want to research popular business areas and cultural sites.

Try to get a sense of the towns or neighborhoods you’re interested in, their proximity to work and how they relate to surrounding areas in terms of income and amenities. Research the area’s cost of living to determine what’s a good fit for you.

A specific neighborhood may be very popular, causing a higher cost of living. However, nearby towns and neighborhoods can be more affordable and still benefit from the proximity to the popular area.

Find A Local Real Estate Agent

Once you find an area or two that you like, it’s important to find a local REALTOR^® or real estate agent. An experienced agent will know the area and what’s trending, and they’ll be able to connect you with a property that meets your needs.

When choosing a real estate agent, trust is key. It’s normal to shop around for agents, and it’s important to find one with experience working in the area you’re interested in. Your real estate agent needs to be someone you can rely on. You should be able to communicate with them and feel that your needs and desires are understood.

Once you’ve chosen the right real estate agent, they’ll keep an eye out for properties in your new state that you may be interested in. They’ll send you new listings and be able to provide you with a virtual house tour. A good agent will be keyed into what’s happening in the local market, and will be able to strategize with you once it’s time to put an offer in.

Make Sure You Have Mortgage Preapproval

Finding a local real estate agent is important, but it’s even more important to have your finances in order. Before you do any serious shopping, you need to get preapproved for a mortgage. For a mortgage preapproval, a mortgage lender will examine your finances and credit report to determine how much they’re willing to lend to you and on what rate and terms.

Create A Move-In Checklist

When relocating out of state, you must keep a lot of things in order. Creating a move-in checklist will help you keep track of everything you need to make the move successful and ensure nothing falls through the cracks.

There’s an incredible value in feeling like you’ve done all you can ahead of the big move. Making a checklist and crossing items off as you complete them helps you stay organized and adjust mentally for this big life change.

Here are some suggestions of what you could include on a checklist:

• Find a moving company or rent a moving truck
• Reserve a storage unit if you can’t move in right away
• Figure out temporary housing if necessary
• Make travel arrangements
• Pack and label moving boxes
• Transfer utilities
• Update address
• Set up mail forwarding

Plan A Visit

If you can swing it, visiting the area you’re planning to move to before you move is a best practice. Look at all the pictures and videos of the area that you want – nothing compares to the real thing. You can work with your real estate agent to set up multiple tours to make the most of your time while you’re in town.

When looking at properties, take a walk or drive around the neighborhood to get a feel for the area. There may be things you see that you would never notice online. For instance, maybe you didn’t realize how close a house is to a city wastewater treatment plant until you smelled the air. Similarly, by exploring the area, you can understand what fun or interesting attractions or activities are nearby.

Consider Short-Term Rental Or Temporary Housing First

Buying a house out of state is hard, especially if it’s a big move many time zones away. It may be better for you to first find a temporary rental to relocate to start your house hunt from your new place. By living in the area, you’ll get a much better idea of what to expect out of the neighborhood or town you’re moving to.

Living in the area also can make communicating with your real estate agent and touring homes easier. If a home gets listed, you can schedule a tour that day and put a bid in as soon as you want to. In a competitive market, every second counts, so being local can help you jump on a listing as it hits the market.

Be Prepared For An Emergency

Buying a home out of state and relocating there can come with unexpected costs. Yes, you should plan for the costs of moving, such as hiring a moving company or renting a storage unit – but you should also build savings to cover expenses you don’t expect. Even with every detail on your thorough checklist checked off, emergencies can still come up.

Weather events, traffic accidents or transportation problems can come with delays and extra costs. Depending on the specifics, you may need some extra cash for a hotel room or to replace some of your items.

Another part of being prepared for an emergency is keeping essentials with you. Don’t pack away your prescriptions and send them off with the movers. If something happens, you may be separated from what you need to stay healthy. Likewise, you should keep all important documents (financials, birth certificates, etc.) on your person. You never know when you’ll need them, and you want to know exactly where they are.

Can I buy a house in another state before I move there?

Buying a house before your moving date is relatively common, especially if the move is unexpected – maybe you received a work promotion or have a family reason. While it’s important to understand that you don’t need to move to your new state before applying for the mortgage, you should know that doing so can be a bit more complicated than waiting.

If you need to buy a house in another state before moving, just know that you’ll have to find a licensed lender in that state. Additionally, working with that on-the-ground real estate agent can significantly help you with your remote home buying process.

Can I buy a house in another state without a job there?

Although most mortgage lenders have income requirements for a loan, it’s certainly possible to buy a house in another state without working in that state. For example, some homeowners may commute across state lines to work, while others may work remotely for a company outside of the state where they plan to move.

Buying a house out of state is a big deal. Not only do you have a large life change with an out-of-state move, but you’re tying in one of the largest transactions you’ll likely make in your life. But that doesn’t mean you need to be fearful. Many people go through this change every month.

If you’re interested in purchasing an out-of-state home, consider the above steps so you know what to look for when you buy. Through research, planning and connecting with a local real estate agent, you can make the move from your current home as smooth as possible. Rocket Homes℠ can help you find an agent who can help guide you through the process.