What To Look For When Buying A House
Andrew Dehan9-Minute Read
January 13, 2022
So, you’re looking to buy a house. Congrats! This is an exciting time, especially for first-time home buyers, when dreaming and moving toward a new future comes into focus.
You may be thinking a lot about how this impacts your family, your future and – this one is less fun – your bank account. The process becomes part of your daily lives when you have designated yourself as “looking for a house.” But do you know what to look for when buying?
Most think they do, but many really don’t. It’s not quite as easy as shopping for, say, a new car. There are going to be tradeoffs and compromises depending on your must-haves and your budget.
Most of us know a lot about what we want, but sometimes the less-exciting factors get brushed aside, even if they’re actually the most critical.
Maybe you have a general idea but are a little uneasy about not knowing what you don't know, so to speak. That’s completely normal. Here, you’ll get some of the guidance you need when it comes to buying a house.
Before You Start Looking At Houses
We all love perusing houses in person and online through the multiple listing service. It’s the stuff of dreams! This makes it easy to fall into the trap of home shopping before you have all the necessary ducks in a row. Don't do it.
Searching for that dream home, starter home, or anything in between is going to end up so much sweeter when you do a little work beforehand to prepare for the search. To that end, there are some key questions house hunters, especially first-time home buyers, should always ask themselves before beginning their search.
Questions like: How much can I afford? How do I get preapproved for a mortgage? How do I find the right real estate agent? Do I want to keep an eye out for pocket listings? What are the qualities I want in a home? What type of neighborhood do I want to live in? It’s fun to think about, but it's also a lot. Taking things one step at a time, in the right order, can go a long way.
If you aren’t sure where to start narrowing down what you’re looking for, check out our home buying quiz as a great first step.
How Much House Can You Afford?
It’s hard to overstate the importance of knowing how much home you can afford before beginning your home search. If you’re not already a master of your budget, become one.
Figure out what you spend a month, how that relates to your monthly income and how much you have saved. Then, and only then, will you be able to estimate what you can use for a down payment on your mortgage and how much you can afford for your mortgage payment each month.
Also think about budgeting for any improvements you might need or want to make to your potential home like adding a pool, replacing a roof or building a garage. When you’re going through this process, always allow wiggle room in these estimates for two key reasons:
- Unforeseen expenses are bound to pop up.
- You don't want to be struggling to make ends meet each month to buy your dream home, especially if it’s overpriced, as it will quickly turn into more of a nightmare.
Are You Preapproved For A Mortgage?
Perhaps you saw a “coming soon” listing for the home of your dreams and you want to be ready to make a move once the property officially hits the market. However, before you buy anything, you need to know how much you can afford. This is no different when it comes to a home search. Understanding your budget starts with mortgage preapproval.
This will be a critical first step that will come in handy later for a variety of reasons. For one, being preapproved allows you to crunch the numbers to see what you can afford and what you want to pay. Note: these two numbers can – maybe even should – be very different. There’s no real reason to pay the absolute most you can afford for a home, and you should avoid overpaying for a house whenever possible. Again, budget wiggle room is a good thing.
In addition, being preapproved shows a seller you’re serious about purchasing, which is critical in a buyer’s market. By the way, we are currently seeing a pretty competitive market, sometimes referred to as a “seller’s market,” in most locations around the country.
If you’re ready to start the home buying process, our friends at Rocket Mortgage® can help you understand what you qualify for. They even offer a Verified Approval, which confirms your credit history, income and assets. This makes your purchase offer even stronger!
Did You Find The Right Real Estate Agent?
Like many endeavors, having an experienced professional guide you along the way is a real benefit. Start by finding a real estate agent you trust to help you through the home search process.
Do your research to find the right agent by asking family and friends for referrals, reading online reviews, and interviewing more than one. When you meet, discuss your nonnegotiables in terms of what you are looking for and ask extensive questions about their experience with your specific situation and desired location. Ultimately, it may come down to your gut and which agent you seem to really vibe with.
Understanding Different Types Of Sales
When house hunting, you’ll quickly realize that there are several types of sales. Understanding the sale details of a home you are considering is important because it can have a huge impact on several aspects of the property, including the timeline of the sale, the condition of the home and more.
Here are a couple types of atypical sales to ask your REALTOR® about during the home buying process:
- Short sale: A short sale helps a financially distressed homeowner avoid foreclosure. The home is sold for less than the amount remaining on the mortgage and all the proceeds from the sale go back to the lender. Properties sold with a short sale may need more work than other properties.
- For sale by owner: Homes that are for sale by owner are listed without the help of a REALTOR®. This means that when the home is sold, the seller does not have to pay commission to a listing agent.
10 Things To Look For When Buying A House
Whether you’re buying in the peak real estate seasons of spring and summer or the offseason of winter, looking for houses is fun, plain and simple. Maybe you enjoy going to open houses and chatting it up with the listing agent. And thanks to virtual reality, it’s easier than ever to browse potential homes from the comfort of your couch.
That said, being too wide-eyed and excited can mean missing some key factors. Let’s review some things that you should be sure to look for when buying a new home.
1. The Neighborhood
Investigating the neighborhood of a potential home and other aspects about its location is as important as the home itself. Ever heard the saying “location is everything”? Well, it is, and not just for being happy in your new home, but for making sure it holds and increases its value during the time you live there if you ever want to sell it in the future.
Research all you can about the area, including schools, transportation, distance to the nearest airport, nearby homes, busy roads, job opportunities, flood zones, and anything else you and your real estate agent can think of that might impact the home’s value.
2. The Size Of The House
It may seem obvious, but don't underestimate the importance of the size of a house. Think about the number of bedrooms, number of bathrooms, if there is adequate storage space, and other factors specific to your individual situation to make sure your future home will accommodate all of your family’s needs.
3. The Floor Plan
Size is important, but how it is used is even more important. A good floor plan makes the best use of the square footage and is functional for what you want to get out of your new home. Thinking about how you will use the rooms and if the layout works will go a long way in knowing how happy you will be living there. It also helps make remodeling easier if you consider future plans in relation to the existing layout. You won’t have to worry about unforeseen pitfalls like moving walls that could potentially be load-bearing.
4. The Exterior Of The Home
Always take a close look at the condition of the exterior of a home. Specifically, review the state of the foundation, the age of the roof, the condition of the home’s siding and upkeep of the yard.
This can be a little less exciting than reviewing the finishes in the interior, but it will save you time and money down the line by making sure everything is in tip-top shape. Or, at the very least, identify what problems you need to address before or after closing on the home.
5. The Home’s Systems
This isn't the sexiest part of the home, but understanding how the key mechanical systems work and what condition they are in is way more important than your opinion of the paint color on the walls. Be sure to examine how the systems of the home are currently operating, including the HVAC, electrical, plumbing, water heater and more. These are the engines that make your home go, providing you the comforts necessary for daily life, so don't overlook them.
6. Signs Of Damage
Carefully inspect the inside and out for signs of damage including odors, water damage and mold. Inspect the electrical systems as well. Electrical issues can create big problems if they’re not taken care of quickly.
When you’re viewing a home, be aware of any signs of electrical issues like a buzzing sound when the lights are on, flickering lights and hot ceiling fixtures. Large cracks along the ceiling or walls could signify that a home might have structural issues. Smaller hairline cracks can form in older homes as they settle, but large cracks could be from large movements. If you find some of these, you’ll want to get a professional in there ASAP to find the root of the problem.
If you are buying sight unseen, it’s a good idea to have your REALTOR® take a look at the property for you, if possible. Knowing what you need to repair or want to ask the seller to fix before signing on the dotted line will bring you some serious peace of mind.
7. Natural Light
When it comes to the natural light a home invites in, there is only so much you can change after purchasing it. Improvements like adding windows can help, but you aren’t changing which way the sun faces anytime soon. If the house is oriented in a direction that gets a lot of natural light – and natural light is important to you – that’s a great thing to take note of.
8. The Basement And Attic
Look carefully at the basement and attic of a potential home. Are they finished spaces or can they be finished later on? Pay special attention to signs of health hazards, damaged areas or evidence of pests. Consider radon testing and professional insulation inspection as well.
9. The Garage
When it comes to your new home, it’s not just about the house. If a garage is included, make sure to spend time looking that over as well. Think about parking space, if the garage is attached or separate, and how much garage storage you need, just to name a few variables to consider.
10. Renovation Needs
Found the perfect dream home where you wouldn’t change a thing? Awesome! Also unlikely, so if not, consider how many renovations each home you look at may need. Specific items to consider are the flooring, paint, and larger projects like kitchen remodels and room additions.
The Importance Of A Home Inspection
It’s a lot to consider, right? Home buying can be stressful, and you may be wondering if you have the right knowledge and experience to see everything that needs to be seen. Well, that’s where a professional home inspection of the property comes in. Your real estate agent can help you find a good home inspector who will come in and look at every aspect of the home to ensure you’re not missing anything before you buy.
Simply put, a home inspection is a visual examination of a property you’re considering making your home. Once a property is under contract and its status is changed to “pending,” a home inspection is used to make sure everything is working properly and can be useful in spotting things that might eventually become a problem.
A home inspector looks at several different items and gives a professional opinion on the status by creating a report that highlights whether there are any problems that were visible, repairs that are needed, and potential risks that the inspector wasn’t able to see.
It’s a very valuable process, but don’t confuse a home inspection with a guarantee that a property is in good condition. An inspection is simply information to help a buyer make a well-informed decision when they are considering moving forward with the purchase of their new home. It’s also important to remember to ask questions when looking at a house as well. The seller can give you better insights into the home they’ve been living in.
Ask Questions Throughout The Process
Best possible advice: Be curious. You should always feel comfortable asking your lender, home inspector and real estate agent any questions that arise. Things like taking notes, asking for more photos or another tour, clarifications on mortgage terms, etc. will ensure you feel informed and at ease every step of the way.
The Bottom Line: What To Look For When Buying A House
Apply For A Mortgage Online
Viewing 1 - 3 of 3
Do You Need A Preapproval To Buy A Home?
Thinking of buying a home and gearing up to start house hunting? There are many things to consider, but should you get preapproved for a mortgage before you start looking at houses?
How To Get A Mortgage Preapproval
When you begin house-hunting, you’ll want to have your mortgage preapproval in hand to be taken seriously by sellers. Learn how to get preapproved for a mortgage.