Planning to purchase a home in 2022? The home buying process is an exciting journey but can be emotionally and mentally draining if you do not plan ahead.
Ensure Your Finances Are In Order
With a home purchase likely being one of the largest investments you’ll make in your life, it is important to ensure you’re ready financially when making your homebuying plan. Talk to your lender, if obtaining a mortgage, to better understand what your home buying budget is. While saving for a down payment may be one of your home buying expenses, you must also prepare for other expenses involved in the transaction, such as:
- Earnest Money Deposit (EMD)
- Home Inspection
- Closing Costs
- Moving Costs
While we saw record-low interest rates over the past year, the Federal Reserve plans multiple rate increases in 2022. When purchasing a home, consider how changing interest rates can impact your bottom line and monthly payment. In addition to the current interest rates, your overall financial history has a major impact on your loan approval and the rate you qualify for. Therefore, it’s important to understand your credit score and make sure it is in good standing so you are not surprised with needed adjustments before you can even begin home shopping.
Create a Wish List
With a realistic budget, you can work with your real estate agent to determine the areas that fit your lifestyle needs. You should make a list of the must-haves and items you would like your next home to have. Your agent can help determine whether your wish list aligns with the communities and price range you’ve established and suggest homes that fit your criteria.
If you have an extensive wish list, it may be necessary to be flexible and not rule out a home because it doesn’t check all of your boxes. While you may be looking for a move-in-ready situation, if you are willing (and your budget allows) you may find a better deal with a property only needing minor updates or upgrades to fit your wish list.
Work with a Local Real Estate Agent for Market Insights
While you can do some research to identify areas near your workplace or important-to-you amenities, tracking trending sold prices and finding comparable properties are best left to a local professional. A local real estate agent will have the most up-to-date knowledge and insights about the market trends in the areas you’re thinking of purchasing in. The recent, rapid market movement over the past couple of years has caused rising home prices for many areas in Southwest Virginia and Northeast Tennessee. Therefore, a local agent can help give you a more realistic perspective of home values by looking at trends over the past several years.
Prepare Emotionally for the Home Buying Process
While having your finances in order and understanding what you are looking for in your next home is important, you should also prepare mentally for what the real estate transaction can bring. If you’ve had difficulties finding a home in the past or experienced issues with previous purchase offers, it can make diving back into the home buying process emotionally draining. However, starting with a positive mindset will help make your home search and purchasing steps go more smoothly. Some things to consider include:
- Do not overextend your budget to the point that it negatively affects your current lifestyle.
- Focus less on things that are easily changed, such as paint colors or appliances, when viewing homes.
- Add more emphasis on the things you cannot change in a home, such as the overall structure and location.
- Many people buying a home experience setbacks or delays, so don’t stress if things do not go exactly as expected throughout the entire process.
Your real estate will be a great resource for guiding you through the home buying process and can help the transaction seem a little less overwhelming. Whether you decided to take a break from searching for a new home because of low inventory or needed to make adjustments to your finances, 2022 could be the year for purchasing your next home. Contact a knowledgeable Highlands Realty agent to better prepare you for your home buying journey in the new year.