Did you know that the real estate market is slowly growing and expanding back to its original glory? In fact, studies show that 52% of Americans are looking to purchase real estate in the next 5 years. If you fall among that statistic, it's important that you understand that the listing price of the home is not the only price tag that you should be worried about. To determine whether you can truly afford the real estate you've had your eyes on, factor in these 3 additional things to the cost.
Any Additional Cosmetic Updates or Repairs that Need to Be Made
Before making an offer on a place, you should definitely attend an open house or ask to get a private viewing of the home. Photographs don't always do the place justice, and you won't be able to get a good idea of the cosmetic updates and the repairs that the property truly needs for you to feel at home. Make a list of the changes that you'll need to make and ask around to get an estimate on what the total cost of making the cosmetic updates or repairs might be.
Transaction Fees for Finalizing the Sale
The cost of the property is not limited to just the listing price. You'll also have to pay a fee for transferring the title to your name, a fee to the realtor and any real estate attorney that might go over your contract and taxes to the government. To determine whether the property is actually affordable for your budget, you'll need to have a sit down with a realtor and take a look at the numbers.
Future Costs like the Cost of Home Insurance and the Property Tax
Depending on how much money you plan on coughing up for the downpayment, you might not have a lot of capital left over. Keep in mind that there are additional costs involved with keeping a home other than having to make mortgage payments. Ask the realtor for an estimate on how much your home insurance and property tax will cost in the future. Don't forget to factor in the cost of inflation. Although the listing price for a property might be lower in one part of town than another, it might come with higher home insurance costs. The property tax might also be more expensive.
There are a lot of numbers that you need to look at before you buy a home. Your realtor can help you calculate all of the costs involved with buying a home to determine whether it truly is affordable on your budget.