Buyers Tools

Buying A Home

Purchasing a home involves numerous complicated choices, so choose a Guide who can assist you in making intelligent and informed decisions.

First-Time Homebuyers

The more prepared you are at the outset, the less overwhelming and chaotic the buying process will be. The goal of these pages is to provide you with detailed information to assist you in making an intelligent and informed decision. Remember, if you have any questions about the process, I’m only a phone call or email/text away!

The decision to purchase a home is probably the largest and most important decision a person will make in her/his life; it’s a major investment for the future. Because there is only so much if it to go around, real estate is the top choice for many investors and a huge benefit for most people and families.

One of the greatest benefits of home ownership is putting money into something that you can call your own and knowing that the monthly payments are going toward the future value—the equity of the home—instead into the pockets of a Landlord or company. When you purchase a new car, it loses value/depreciates the moment you drive it off the lot. When you buy a home, however, it has the potential to appreciate year after year, in a few ways:

1. Many properties experience an increase in value as the areas around them become more desirable. If this happens—the demand increases--home values can increase and homeowners often benefit from the sometimes limited supply of housing. If you purchase a home in an area a lot of people would like to live in—like many walkable areas close to shops and public transport, neighborhoods located near major employers, in rapidly gentrifying areas, or in areas that are considered safe with lower crime rates—your home values may increase more than in other areas. So one way a home can provide a good return on your investment (ROI) is that it increases in value.

2. The second way is that each month, as you make the mortgage payments, the principle goes down, giving you more equity in the home. You may even be able to use your home's equity to finance some needed improvements and/or repairs. In some cases—not all--these changes may even increase the value of your home. An upgraded kitchen or bathroom, for example, or hardwood flooring, or a well-done additional room are some changes that could result in added value.

The Best Investment
As a fairly general rule, homes appreciate about four to six percent a year. Some years will be more, some less. The figure will vary from neighborhood to neighborhood, and region to region. Increasing in value five percent per year may not seem like that much at first. Stocks (at times) may appreciate more, and during robust times, you could even earn over six percent with treasury bonds.

Presumably, if you bought a $200,000 house, you did not pay cash for the home. You got a mortgage, too. Suppose you put as much as twenty percent down – that would be an investment of $40,000. At an appreciation rate of 5% annually, a $200,000 home would increase in value $10,000 during the first year. That means you earned $10,000 with an investment of $40,000. Your annual “return on investment” would be a whopping 25%—that’s traditionally much more than stock or bond purchases. Of course, from that 25%, you are making mortgage payments and paying property taxes, along with other costs like maintenance. Since the interest on your mortgage and your property taxes are both tax deductible, though, the government is essentially subsidizing your home purchase.

If you make intelligent decisions during the home-buying process, your rate of return can be higher than most any other investment you could make.

Seller’s Disclosures and Inspections
Although you have toured the property, looked at the walls and ceiling, turned on the faucets and played with the light switches, you have not lived in it. The seller has years of knowledge about his or her home and there may be some things you want to find out about as quickly as possible. For this reason, we will require certain disclosures from the seller as part of your offer.

Basically, you want the seller to disclose any adverse conditions that may have a substantial impact on your decision to purchase the home. This would include any problems with the house, any past problems that were dealt with and how, and any other details the seller can tell you.

If I am the agent representing you, this is automatic to ask for the disclosures, but many states do not require individuals selling their own home to provide you with this information. Often they do not require banks selling foreclosed property to provide these disclosures, either. Obtaining these types of disclosures should always be a part of your offer, and time is of the essence.

Inspections will give us the most information about the home. Besides the appraisal and the termite inspections, you should also have a professional go through the house and seek out potential problems. Of course, you will have inspected the home, but you are not used to looking at some things that a professional will find. Even if they are not things the seller is expected to repair, at least you will have foreknowledge of any potential problems.

The seller will want this inspection performed quickly, so that you can approve the results and move forward with the purchase. Once you receive the inspection, we will want to allow yourself sufficient time to review and approve the report. If you do not approve the report, we will negotiate with the sellers on which repairs should be performed and who should pay for those repairs. Otherwise, you can cancel the purchase without penalty, provided wwe have not passed any deadlines included in your offer.

I utilize different tried-and-true professionals for different inspections. We should not be afraid to use a “deal-killer” inspector to inspect the home. If there is something that is beyond your comfort level, I know you would rather move on to another property than discover the defect—and be stuck with it—after you already own the home. I have encouraged clients to walk away from “bad” homes and have never regretted doing so.

Before closing, we will want to revisit the property in a Final Walk-Through, to ensure it is in the condition you have required in your offer, and to inspect that any required repairs have been performed. We will do this within five days before you intend to close.

This is a lot of information to absorb. If you have questions about any of the topics presented here, let’s sit down and talk about what you are looking for, and how we will go about making it happen. Remember: I am only a phone call or an email/text away.

What is That House Selling For?

Find out what that great house down the street is listed for, or use the free search engine to find that perfect MetroABQ home.

Here is a search engine for the MetroABQ area Multiple Listing Service (MLS), with up-to-date property listing information. The search is free to use, and allows you to choose the area, property type, home & land size, and even how many bedrooms and baths you want, and more.

When a new property comes available that meets your search criteria, you will receive an email that includes detailed information about the listing with photos, and a map and directions, so you can drive past to see if you like the house and area.

Then you can Save and Organize your property listings to view and compare later.

It’s easy! And remember, if you have questions about the house or area, I am only a phone call or an email/text away.

MetroABQ Resources

Below are helpful downloadable documents and Links to some of what the Greater Albuquerque area has to offer. The list is ever expanding, so stop back from time to time to discover more. If you come across a great link or document that you would like to see here, send me an email.

Mortgage Calculator & Rates

Remember, if you have questions about obtaining a mortgage, or about current interest rates, I am only a phone call or email/text away.

usmortgagecalculator.org

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Buyer Tools