Buying property is one of the best investments you can make, but there are several factors that you need to consider before going ahead with a purchase. Before you jump in, take a few minutes to consider the following:
Know your budget
Before you really get started you need to know exactly how much money you have available and how much you can spend without making drastic lifestyle changes. Most people who purchase property quickly find out there are hidden costs that suddenly crop up, so over-budgeting and under spending is advised. Aim for property in a lower price range and don’t purchase at the absolute limit of your budget. A general guideline when budgeting is to only include regular income and not add irregular amounts received.
Understand the costs involved
The biggest downside to purchasing property is all the additional fees that are incurred. Some of the services and fees you will be obliged to pay are mortgage application fees, home inspection fees, closing costs such as transfers, title deed fees and relevant attorney charges. Expect to be charged administration fees, filing fees or other costs that are usually described as ‘an additional fee for services’. A clear understanding of all possible additional fees and costs involved will keep surprises to a minimum.
Check rates and taxes
If you are planning on purchasing property in a specific area do some research into the rates and taxes that are associated. Different areas may have higher rates depending on their location, vicinity to schools and other amenities. In some areas houses have been re-appraised recently and the taxes have been increased, so ensure your research is based on current figures.
No one wants to think that their property may be in an undesirable area but future development plans and environmental factors can greatly affect a property’s resale value. If you are ready to purchase a property in a specific area ensure that there are no major plans for the immediate vicinity that you won’t have control over. Take note of the surrounding neighbourhoods and be aware of how home owners and tenants maintain their properties.
Purchasing property can take time and patience but it is a worthwhile investment that can have big rewards.