1. 90% of all home buyers begin home shopping online
Online house shopping is the best way to get familiar with the market, houses, prices, neighborhoods, and current inventory of homes without leaving your home or office. You can search for properties, compare similar properties, research the neighborhood, calculate commute times, rate schools, and even pull up crime stats for your area online. You’ll even get an education about how much or how little your money will buy.
2. Plan to live in your home for at least five years
Based upon the national rates of home appreciation and prices, it’s best to plan on living in your new home for five years, minimum. Otherwise, financially it may not make sense. You could lose money if you sell again too soon.
3. Number of days on the market
When house shopping, find out how long a home has been on the market. This can help you gauge if it’s priced too high or has too many flaws. Homes that are priced correctly in the right neighborhoods tend to spend the fewest days on the market. Homes on the border neighborhoods that are overpriced compared with comps, or have major structural or cosmetic issues tend to sit on the market much longer. However, homes with long for-sale shelf lives aren’t all duds. Some may be slightly overpriced and just need some improvements. With a little imagination and the right guidance from an agent, one of these could be your dream home.
4. Out-of-pocket per month
Find out how much your home will cost you out of pocket every month: your mortgage and estimated taxes and insurance. Having this number right upfront helps you tailor your shopping choices to those homes you can actually afford.
5. Borrower’s debt can’t exceed 43% of your income
This is a very important number. In general, your debt, including mortgage payments, can’t total more than 43% of gross monthly income (although there are exceptions to that cap for the next several years). Also, points and fees are limited to 3% of the loan amount.