Finding a home you love that won’t put you into too much debt can be a challenge. While we all have ideas about what constitutes a “dream home,” depending on just how big the dreams are, not all of us can afford it. That’s why it never hurts to do a little “bargain shopping” when it comes to browsing real estate listings. Here are a few methods for uncovering a home you can enjoy that won’t drown you in mortgage debt.
1. Don’t discard fixer-uppers
With the inventory of homes for sale getting slimmer by the day, it can be tough to find a “move-in ready” home that’s also in your price range. First time home buyers will especially have a bigger challenge ahead of them, as they typically have less money to put down and low-priced starter homes tend to go fast. One way to find a bargain is to check out homes that need a little TLC. Of course, buyers who go this route need to be prepared for the extra work that may be involved in a fixer upper purchase. Depending on how much work the home needs, the “bargain” listing price may not represent a true bargain at all, as the cost of repairs and/or remodeling can swiftly put you in debt. However, if all the home needs is some basic cosmetic work (fresh paint, minor repairs, etc.) you could easily come out ahead by purchasing a fixer upper home. Also worth looking into is the FHA 203k loan, which allows qualified borrowers to finance much of the needed work for a home that’s fallen into disrepair.
Note that if the home needs major repairs some lender and program guidelines will require that repairs be completed prior to financing approval. Thus, some borrowers will need to seek out 203K loans or other types of rehab financing.
2. Check out up-and-coming neighborhoods or areas that are going through revitalization
As any real estate agent will tell you, location is typically the greatest determining factor in a home’s value. While there are some neighborhoods that seem to always hold their value, others tend to go through phases. An area that wasn’t very attractive 10 years ago can often become the new hip place to live, as economic development and community improvements bring more interest to the area. Talk to a local real estate agent to see where the up-and-coming neighborhoods are and ask about any future plans for revitalization for areas that may have been burdened by blight or economic struggle. Sometimes, once the city decides to put in funding for community development, these areas can rapidly appreciate in value. If you can snag a home in one of these areas early enough, you could wind up with a home that’s worth way more than you originally paid for it – and that will pay off big when it comes time to sell.
3. Search new developments outside the city limits
While living within the city has its obvious benefits, homes are often less expensive outside the city limits. You can sometimes find good bang for your buck when you buy a home that’s a little ways out, as price per square foot tends to be lower in areas that aren’t as developed. And, much like homes in an area that’s being reinvented, homes in a more rural, underdeveloped area can often appreciate in price as the community grows and more business flock to the area.
For more ideas on searching for a real estate bargain, get connected with a qualified Texas real estate agent. He or she can access the latest market information and provide you with the best course of action in your home search. Also, be sure to talk to your lender about getting pre-approved for a Texas home loan. Once you have an idea of how much house you can afford, it will make your real estate search easier and can even give you more clout as a buyer.
If you have any financing questions, please do not hesitate to give us a call at 972-591-3097. We’re located in McKinney and we offer residential home financing assistance throughout most of ??Texas and Oklahoma.