Searching for a new home doesn't have to be overwhelming. Here's a quick guide to find a house you'll love in 8 easy steps.
STEP 1: FIGURE OUT WHAT YOU CAN AFFORD.
To avoid the disappointment of falling in love with a house you can’t buy, we suggest you start the home buying process by figuring our exactly what you can afford and/or are willing to pay for a home.
Unless you are planning to buy your home outright with cash, it is useful to meet with a mortgage lender. The lender will look at your financials and give you a sense of what kind of loan you qualify for or help you figure out how much you are comfortable spending on a mortgage. The lender can also give you a pre-approval letter which will come in handy once you decide to make an offer on a house.
STEP 2: IDENTIFY YOUR LONG TERM GOALS.
Spend some time thinking about your goals. We’re not talking about deciding what style of home you want to buy. We’re talking about figuring out what you want to get out of your home purchase in the long term.
For example, you might want your first home to eventually become part of a larger real estate investment portfolio, or perhaps you want a place to grow your family, or maybe you want a starter home that you plan to sell in 5-10 years. All of these goals are great, but the search criteria and the way in which you go about finding each of these homes is very different.
Consider this scenario. Let’s say you want to buy a house on a busy street because it’s priced lower than other homes. That’s an okay idea if you are looking to build an investment property and will eventually rent out the home to tenants. If, on the other hand, you plan to own the home for a short time, sell it, and move to a more desirable location in a few years, then the home on the busy street is probably not the right deal for you because the location will depress your appreciation and make it more difficult to sell in the future.
STEP 3: ESTABLISH CRITERIA FOR YOUR HOME SEARCH.
This is the fun part. Figure out what you want in a home before you begin house hunting in earnest. You probably have a list of things you’d love to have in your new home. Is a two-car garage a convenience or a necessity? Do you really need a farmhouse sink to be happy? Are you willing to put in some elbow grease to bring a home up to date or does it need to be move-in ready? There is no right or wrong answer here, only the right answer for you.
Develop criteria for your home search. These criteria include things like the number of bedrooms, square footage, location, style of home, parking and other factors. We suggest sorting the home features into three major categories:
- Must haves: If a property doesn’t have these items, it shouldn’t be considered. These are essentials like the number of bedrooms or bathrooms.
- Should haves: Once a property meets all of the must have items, it stays in contention if it meets several (but not necessarily all) of your ‘should have’ criteria.
- Wish list: With all of the ‘must haves’ covered and many of the ‘should haves’ included, your wish list are those features that really set a home apart.
Your criteria should also include ‘deal breakers’ that would eliminate a home, such as backing to a highway or a railroad. Periodically referring to your pre-established criteria will help you stay focused on your goals and make a smart purchase choice.
We can help you sort your wants and needs so that you find a home that truly meets your priorities.
STEP 4: GET PERSPECTIVE ABOUT THE MARKET.
Meet with a Realtor to gain an understanding of the current Austin real estate market. Real estate is cyclical, and an experienced Realtor can give you perspective so that you recognize a good deal once you begin looking at homes.
Every Realtor approaches this differently, but for our part we’ve found it helpful to expose our clients to a variety of neighborhoods and homes. This helps our clients understand what is available at different price points in different parts of Austin so that they can narrow down their search to neighborhoods that align with their housing goals.
We call this “speed dating” for homes. It sounds corny but it's a fun and effective way to give you general exposure to the Austin market. On our initial speed dating tour we will quickly look at 12 – 15 homes during a 3 hour time period. We move at a brisk pace, usually spending 5 minutes or so per property. There is no buzzer to tell you to move on, but since the objective is to eliminate homes you don't like there is no need to linger.
Here are some tips for our speed dating tour:
- Dress comfortably. We'll be moving fast.
- Eliminate all the homes you can. If you see something that's a deal breaker, it’s time to move on to the next one. If we see a home you really like, we will spend more time.
- Try not to keep more than the top 3 homes in your head. Rank them 1, 2, 3 as we go. If you buying a home with someone, the ranking system makes it easy to discuss your favorites, what makes them a favorite, and why they rank higher or lower than other properties. If it’s helpful you can take exterior photos and make notes to jog your memory.
- When you eliminate a home crumple the information sheet and toss it in the back of my car. Or if you’re so inclined you can throw it at your partner. We’ve had some pretty fun paper wars happen in the backseat over the years.
Don’t worry. A slower tour comes later once you have a better idea of your preferred neighborhoods. And of course, if you are already committed to a particular part of Austin, we can skip this step altogether.
STEP 5: HAVE REALISTIC EXPECTATIONS.
Very few homes are perfect. But there are a lot of homes that are really close. Know what you want, but be prepared to accept that the home you buy may not be flawless. Remember, you can always update your home, the neighborhood may change in a few years, or you may decide to move again, so this might not be your final home. Besides your financial capabilities, almost everything else is beyond your control so be flexible with the process.
It also helps to recognize that sometimes good homes have gross owners. Piles of dirty dishes, baseboards that have never been cleaned, goats in the backyard, awful decorating choices – we’ve seen it all. If you can see past the dirt, clutter, or outdated tastes of the current homeowners, you may just find a hidden gem.
Prepare to be patient. It can take time to find the right house that meets your goals. It’s rare to see one home and be done with your home search (aka one and done). In many cases it takes several property tours over the course of several weeks or even months to find the right property to meet your needs. Be prepared to balance patience with your ability to be decisive when you find the right home. Depending on market conditions, your first offer may not get accepted but be persistent. We will guide you through it and ensure you see the latest properties, including exclusive Compass listings before they hit the market.
House hunting can be an emotional roller coaster. Depending on market conditions there may be limited inventory to choose from, making it likely that houses will sell quickly perhaps even in a multiple offer situation. You may see and fall in love with several houses before successfully purchasing one – and we know it is disappointing to lose out on a house you want.
You can ease some of the disappointment by not getting too attached until you have secured a contract and gotten past your option period. You can also avoid some of the heartache of losing out by having an established strategy for winning in a multiple offer situation or beating out a cash offer. Make sure your Realtor has a defined strategy for those situations.
STEP 6: DECIDING ON THE ONE
I can usually tell when my clients have found “the one.” Their energy changes, they want to linger in the home longer, they start talking about where their furniture should go. Here’s how you can tell yourself.
No matter how long you've been house hunting, when you walk into “the one” you'll get an involuntary urge to do whatever it takes to make that home yours. If you're at an open house and other buyers are viewing the place, you'll start to feel competitive. If you're at a private viewing, you'll start to talk numbers and offer logistics. For that matter, some buyers start making calls to their financial planners, generous parents, and contractors from the front porch steps of their "one" during the first viewing.
STEP 7: DOUBLE CHECK YOURSELF
Once you fall in love with a home, it can be difficult to see the home objectively. This is a good time to think back to your long term plans to make sure the home that you’ve fallen in love with aligns with your goals.
Make sure it’s a good investment. Whatever your objective, think long and hard about the value of your potential purchase, as well as what the future might bring to the property (or part of town) you choose. Home sales are usually impacted by condition, location, and price. Each of those factors can have a big impact on your ability to sell the property in the future or on the profit you can make.
Real estate can be an excellent vehicle for growing your wealth. The key is to make wise purchase decisions that have a high potential for growth. An experienced Realtor can be worth their weight in gold (literally) to ensure you are making a wise investment. Ask your Realtor:
- What is the past rate of appreciation for the neighborhood?
- What is the potential for future appreciation?
- Will the home hold its value if you ever decide to re-sell?
- Does the home have any major strikes against it that will dampen the rate of appreciation or make it difficult to re-sell?
- Would the property be a suitable rent house that would generate positive income if you ever needed to move out?
Don’t just focus on the house, focus on the neighborhood. Drive around the neighborhood and check out the schools, parks, shops, grocery stores, and so on. Go for a walk and take a peek at your potential neighbors. Dine at a local restaurant in the area. Visit the area in the nighttime too. This will give you a better sense of the community you will soon be joining.
Make sure your love the house and not just the way it’s styled. Homes for sale are often staged and styled by professional designers. They are meant to look stunning. But all of that amazing furniture doesn’t come with the house. Try to imagine your own furniture and style in the home.
STEP 8: OFFER, NEGOTIATE, RE-NEGOTIATE, AND CELEBRATE.
Once you’ve found “the one,” it’s time to make an offer. Expect to go back and forth a few times before reaching an agreement with the seller. Even after you’ve agreed on the terms of purchase, you may find yourself re-negotiating those terms after you’ve completed your due diligence with a home inspection. An experienced Realtor will offer valuable insight in how to approach the negotiation to get you the best deal possible. At long last, it’s time to pop the champagne and celebrate this major milestone.
Are you ready to find a house you love?
Email Paul or call to get started.
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