What is a real estate agent’s role?

How much house can I afford? 

The first step to discovering how much house you can afford is understanding how lenders calculate your buying ability. The amount you qualify for is a monthly calculation based on your income and debt ratios, not on your total debt. This is why interest rates heavily influence your pre-approval level, the higher the interest rate, the higher your monthly payment. 

If you are looking to boost your budget you will want to reduce your required payments each month to qualify for a higher mortgage. Lenders are attracted to buyers with fewer debt entanglements and are not as concerned about the overall debt amount.

Your down payment will also influence your ability to purchase. The more you have to contribute to your down payment, the more house you can afford. With so many mortgage programs out there, don’t let not having a lot of money in the bank keep you from making a home purchase. There are programs out there with 0 down options, and with the opportunity to ask for seller-paid closing costs, or down payment assistance programs you can get into a house with little money down. That said, the more cash you have to bring to the table the more options available when looking for the right fit.

Lenders can help sort through your options if you have a home to sell or want to pull funds from your home. If you have a house to sell, do you need to sell your house first to pay for the next one? This is another time lenders can help with different options. Many people don’t want to sell their current house until they know they can get the next one but need money out of their current place to get that one. Talk to a realtor to know your potential proceeds after the sale of your house. No automated valuation system can match the ability of a realtor or appraiser to pinpoint real market value. 

After you talk to a lender and decide how much you can spend, you will want to consider the following:

1. How much time will you be spending at home?
2. What kind of lifestyle do you want?
3. What do you NEED in a home?

Once you have your wants and needs sorted out do a home search for your dream home and see what most homes that fit your criteria cost. 

Is it in your pre-approval amount? PERFECT! Start shopping.

Is your dream home stretching your budget? Or the right house just isn’t on the market?

This is when you know you have to start reconsidering your criteria. What do you truly NEED? Can you buy something that has the potential to become what you want? Remember that the most expensive move is the one that happens too late. Many people put off buying and end up paying higher prices down the road for something they wanted to be in for years. 

Once you have the information you need, you’ll be ready for a successful home purchase.

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Cat Conklin

616 REALTY
Associate Broker

How much is my house worth?

Figuring out the value of your house involves several factors. Here are a few ways to help guide you to find that perfect price. Keep in mind, it is an emotional process, and your ideas of the price may differ from a professional Real Estate Agent, so it helps to give yourself a little grace.

1. Comparative Market Analysis (CMA): I tend to stick to the MLS, and the RPR, and stay away from Zillow and Realtor.com, they tend to be inaccurate. 

2. Professional Appraisal: If you have a hard time comping a unique property, a professional appraisal is usually the best direction to go. Example: a farm that is located in a highly populated residential area.

3. Consider the properties features, such as the location, the recent renovations, the conditions of the home, and the square feet. Remember there is no perfect comparable, so factoring all these in, is very important. 

4. THE MOST IMPORTANT THING! Always consult with a professional Real Estate Agent. We are always here to guide you, and help make your life easier through that process and get the top dollar for your home.

Deb Ables

616 REALTY
REALTOR®

Are new builds worth it?

When considering a home purchase for the second, third, or subsequent time, the allure of new construction often comes into play. Although new builds may offer slightly less square footage for the price compared to existing homes, they come with numerous advantages that make them a compelling option.

Benefits of New Construction:

1. Low Maintenance and Repairs: One of the most significant advantages of new construction is the minimal maintenance required. New homes are built with the latest materials and technologies, which typically means fewer repairs and less upkeep for the first ten years or more.
2. Energy Efficiency: Modern construction standards mean new homes are often significantly more energy efficient. This not only helps the environment but can also result in lower utility bills for homeowners.
3. Customization: Building a new home allows buyers to customize their space to meet their specific needs and preferences. From choosing the floor plan to selecting finishes and fixtures, new construction offers the flexibility to create a home that perfectly suits your lifestyle.
4. Control Over Investment: With new construction, buyers have control over where they invest their money. Unlike existing homes where previous owners may have made upgrades that don’t align with your preferences, new builds allow you to prioritize and invest in the features that matter most to you.

The Realtor Advantage in New Construction:

Building a new home involves navigating a complex process with numerous variables and potential pitfalls. This is where a Realtor with experience in new construction can be invaluable.

1. 1. Experience with Builders: Each builder has their unique process. Some offer extensive support, while others require more legwork from the customer. An agent with experience can help you understand your builder’s process and offer tips on dealing with them specifically.
   2. Guidance on Contracts: New construction contracts are often drafted by builders and can be heavily weighted in their favor. A knowledgeable Realtor can help you understand these contracts and ensure your interests are protected, possibly recommending additional advice from a skilled attorney where needed.
   3. Design and Layout Advice: Experienced agents can offer suggestions on design and layout that you might not have considered. For example, adding extra depth to your garage or increasing the height of garage doors to accommodate taller vehicles can make a significant difference in your daily comfort and convenience. Adding or removing windows, moving walls, or opting for a 9-foot basement ceiling over 8 feet are all considerations. These changes not only enhance your enjoyment and use of the home but also impact future resale value.
   4. Electrical and Lighting Considerations: From additional outlets to strategic lighting placements and future-proofing for potential features like a pool or spa, a Realtor can ensure your new home meets all your electrical and lighting needs. It’s much less expensive to include these upgrades in the original build than it is to retrofit them later.
   5. Exposure to Options and Upgrades: Builders generally do not present all available options and usually make suggestions based on a buyer’s request. Since buyers won’t ask for features they don’t know exist, a seasoned agent will bring to light possibilities that could enhance your home’s functionality and value, ensuring you make informed decisions. For example, a Realtor might recommend soundproofing areas like laundry rooms and master bedrooms for enhanced privacy and comfort or suggesting an upgrade to a zoned HVAC system for more efficient heating and cooling.
   6. Minimizing Regrets: An experienced new construction Realtor will ensure you have as few “I wish I would have done this” regrets as possible. Agents learn from each home-building experience and become skilled at understanding their clients’ wishes to help ensure their new home meets their expectations. For instance, if an agent knows their client will eventually want a swimming pool, they can help ensure the lot can accommodate it. This includes ensuring any well or septic system is not placed where the pool will go, requesting a larger natural gas meter for pool heaters, and having the builder pre-wire for the pool’s electrical supply requirements.

Conclusion:

While new construction might come with a slightly higher price tag per square foot, the benefits of a low-maintenance, energy-efficient, and customizable home can make it a worthy investment. Having a skilled Realtor by your side ensures you navigate the complexities of building a new home with confidence, making the most of your investment and creating a space tailored to your needs.

Rob Young

616 REALTY
Associate Broker