The secret to a successful house-hunting trip is to be as informed and organized as possible before you go. When purchasing a house with the intention of reselling it later on for a profit, you want to keep a few things in mind, not only for yourself but also for the prospective buyer.
1. Make a list of the critical requirements for a new neighborhood. These include, commuting time to your employer, school requirements, community demographics (age, education, lifestyle), population density (urban, suburban, or rural), and community institutions that are important (being close to entertainment, places of worship, or other amenities)
2. Get an idea of which neighborhoods are likely to meet your requirements or those of a prospective buyer. Talk with others who already live in the area to gain their perspective.
3. Determine a price range before you start looking for a home. Talk with a realtor to see how much of an increase or decrease to expect in home values in the area over the next couple of years. It is important to arrive from your house-hunting trip with a realistic expectation of what you will need to spend in order to afford a home in a neighborhood that meets the above requirements.
4. Make sure that your realtor understands your neighborhood requirements and your price range, and that the realtor believes that your price range is realistic.
5. When you go on your house-hunting trip, take along a map, your research notes concerning communities (schools, amenities, etc.), and a house-hunting checklist. A checklist is important and gives key features of the houses you visit so that you can take notes to compare these features with what you are looking for. You can use the map to mark locations of houses.
6. If you will finance your purchase, find a loan officer that understands what your goals are and get prequalified. This will tell you you how much of a loan you will be approved for, how much of a down payment you will need, closing costs and finally that will tell you how much money you will have available for renovations!
7. Have a list of contractors that can come in pretty quick to give an estimate of how much things that you want to renovate will cost. Since this will be done before you make an offer for the house, they need to meet you at a perspective house you are considering so they can give you their estimates and their professional opinions. They are experts, so use them wisely. That does not mean you follow all their advice, their goal is to maximize their profit. But when you compare things that different professionals will tell you, that will slowly give you a good idea about what you should do to maximize your profits!
With good planning and the right realtor, you can accomplish a lot on your house-hunting trip!
Topics: Checklist, Fix and Flip, House-hunting, Investment Property
