Kevin Durkin's Blog
Whether you’re a first-time homebuyer or you’re upgrading to a larger house to fit your family’s needs, it’s vital to understand just how much house you can afford before you start shopping for homes.
When planning for your future home, there are two main things you need to figure out.
What is a smart amount to spend on a home for your budget
What are the key features in a home that will give you the most benefits for the cost
These two questions may seem simple, but there are quite a few factors that should go into determining each one.
So, in today’s post, I’m going to walk you through the process of determining what kind of house you can afford so you can make the best home buying decision for you and your family.
A smart home buying budget
To create an effective budget, you’ll need to gather some information and possibly create a spreadsheet with Excel (or a free alternative like Google Sheets).
On your spreadsheet, you’ll first want to add up all sources of income that your family has. This is the easy part for most people who only have one or two sources of income based on a salaried job.
Next, is the hard part--expenses. We can’t just use your current expenses to determine the new budget because we have to account for changes in several areas.
If you aren’t sure of the cost of living for the area you hope to move to, try plugging it into this cost of living comparison tool to see get a better idea of the cost of things like transportation, childcare, groceries, and more.
Likewise, it’s also a good idea to assume you’ll be paying more in utilities if you’re hoping to move into a home that is larger than your current home. Keep in mind, however, that different houses have different levels of energy-efficiency, so it’s a good idea to also ask the seller of the homes you’re interested in to determine what your costs might be.
Now, subtract your expenses from your income. The amount remaining should easily cover whatever mortgage payment you receive along with, ideally, 20% of your income going toward savings.
Deciding what you need in a home
The second part of determining how much house you can afford is to find out exactly what you’re looking for in a home. The number of bedrooms, bathrooms, location, the size of the backyard; all of these are questions that have a monetary value.
So, to really answer this question you’ll need a strong understanding of what you and your family’s goals are for at least the next 5-7 years, if not longer.
Once you have your long-term goals and a good understanding of your budget, you can start safely shopping for homes with a clearer idea of the type of home you’re looking for and just how much home you can afford.
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According to a report by the Asthma and Allergy Foundation of America, more than 25 million people in the US live with asthma. The most common type is allergic asthma. With that in mind, improving the quality of air in your home is an important consideration. When the air quality in your home is good, it can reduce common symptoms like shortness of breath, red eyes, and wheezing.
Allergens in your home like pollen, pest droppings, dust mites, and pet dander often aggravate asthma symptoms. HVAC systems are built to filter these allergens but if the system is not optimized, it could do more harm than good.
Here are four basic but effective ways to allergy-proof your HVAC system:
Schedule annual maintenance
Schedule a visit with a licensed professional every year to ensure your HVAC system is running clean and efficient. Ensure the service call includes replacing air filters and cleaning ductwork.
Clean or replace your HVAC filters
A typical HVAC filter should be deep cleaned every two to three months. A HEPA (high-efficiency particulate air) filter does not need to be cleaned as often, upgrade to save some maintenance time. Generally, a filter must get rid of at least 99.97% of the contaminants in the air to acquire a HEPA rating. If you choose a HEPA filter, select one with a MERV rating of at least 10. MERV ratings grade the quality of the air filtration on a scale from 1 (lowest) to 20 (highest). The higher the score, then the more satisfying the quality of the air.
Run your HVAC system regularly
Run your HVAC system for at least 30 minutes each day to help with air circulation. The air conditioner moves air in your home by bringing in the fresh outdoor air. If you own a smart thermostat, consider programming your system to run at a specific time and duration.
Install a UV light near your HVAC evaporator
An HVAC contractor can help you install a UV light close to your system’s evaporator. A UV light can control mold growth and other bio-organisms that might be present in your HVAC unit.
For more effective ways on how to allergy-proof your HVAC system, contact a professional HVAC contractor. Let your professional real estate agent know if you've optimized your HVAC system for allergen control.
An offer to purchase represents a key milestone in the homebuying journey. Ultimately, it helps to plan ahead to ensure you're ready to submit a homebuying proposal. Because if you know what it takes to put together a competitive offer to purchase a house, you can boost the likelihood that a home seller accepts your proposal.
Now, let's take a look at three tips to help you get ready to submit an offer to purchase.
1. Study the Housing Market
The housing market fluctuates frequently. As such, you may enter a real estate market that favors buyers but slowly shifts into sellers' favor, or vice-versa. But if you examine the real estate sector closely, you can differentiate a buyer's market from a seller's one and submit an offer to purchase that accounts for the current housing market's conditions.
If homes are selling quickly at or above their initial asking prices, you may be working in a seller's market. Comparatively, if houses linger on the real estate market for many weeks or months before they sell, you may be operating in a buyer's market. As you start to craft an offer to purchase a house, you should analyze the real estate market. By doing so, you can submit an offer to purchase that matches a seller's expectations.
2. Get Your Finances in Order
Entering the housing market with a budget in hand usually is beneficial. If you get pre-approved for a mortgage, you can narrow your house search and stick to a budget as you pursue your dream residence.
Banks and credit unions can teach you everything you need to know about fixed- and adjustable-rate mortgages. Perhaps best of all, lenders employ mortgage specialists who can respond to your mortgage concerns and questions. If you collaborate with a lender today, you can get the financing you need to buy a house. Also, you can conduct a search for homes that fall within your price range and reduce the risk of submitting an offer to purchase that surpasses your budget.
3. Avoid a "Lowball" Offer
Submitting a "lowball" offer to purchase a home may seem like a good idea at first. Yet submitting a homebuying proposal that falls short of a seller's expectations is unlikely to help you acquire your dream house.
In most instances, a seller will instantly reject a lowball offer to purchase. And if you receive an immediate "No" from a seller, you risk missing out on the opportunity to purchase your ideal residence.
Allocate time and resources to craft a competitive homebuying proposal – you'll be glad you did. Otherwise, you run the risk of putting together a lowball offer that will miss the mark with a seller and force you to look elsewhere to purchase a house.
Lastly, if you need extra assistance as you perform a house search, you may want to hire a real estate agent. By employing a real estate agent, you should have no trouble crafting a competitive offer to purchase any home, regardless of the housing market's conditions.