The surge in U.S. home sales surprised many industry watchers since it happened in the middle of a health crisis. The work-from-home arrangements and shelter-in-place directives contributed to this as Americans looked for comfortable homes to ride out the pandemic.
But the huge demand also affected the supply of homes in the market. It resulted in higher home prices, which saw home sales decline after over a year since the pandemic started. Despite this, the demand continues as the US economy starts to recover.
If you are one of those people planning to buy a house during the pandemic, you should take a step back and look at the current market before signing on the dotted line. Here are some tips to consider to help you in the process of buying a house during the pandemic
Set a Budget for the Purchase
The first thing you should do is to set a budget for your purchase. The budget shows how much you can afford. With increasing home prices, you should set a maximum limit to not end up in too much debt that you cannot afford to buy anything else.
While you can stretch your budget to get a better home, you should make sure that you are comfortable with it. Buying a house is a huge decision, and you might not be able to afford a wrong decision during this time.
You should remember that you have other expenses to consider aside from paying for the house. Setting a budget allows you to ensure you will have enough funds for the other expenses.
Set Aside Funds for Other Expenses
When making your budget, you should also set aside funds for other expenses. As indicated earlier, buying a house isn’t your only expense. You also have to consider expenses for utilities, food, and maintenance of the house. If you are a first-time homebuyer, you should understand the cost of maintaining a home. So, you should make sure not to use all your funds to buy a house.
List Down Options
To ensure you stay within your budget, you should list the things you want in the house. Using this list, you can check the houses available in the market. Then, check the price to see if it’s within your budget. You should have more than one house on the list so that you’ll have an option in case the first one is unavailable or the price is beyond what you can afford.
You should also view the homes before you purchase them. While the pandemic has made this challenging, you can opt for virtual home viewing. This allows you to check the house even if you do not go to the location. Make sure the house fits your requirements before making the final decision.
Work with a Reputable Real Estate Agent
Buying a house is not easy if you do it on your own. So, you should work with a real estate agent who is knowledgeable about the area where you want to buy a house. The agent can help you look for a house that fits your requirements. They can even give you an insight into the areas where you want to buy the house. Additionally, real estate agents can give you a heads-up on the benefits available to you if you are a first-time homebuyer.
When looking at the financial aspect, you should look for a reputable lender or a reliable mortgage company to ensure you will get a good deal on your house loan. Make sure to go through everything on the contract before you sign anything. You can even compare the rates offered by these companies. Just make sure you meet their requirements.
Get a Pre-Approved Loan
With the limited supply in the market, sellers more would often deal with serious buyers only. One way for you to show the seller that you are serious is to get a pre-approved loan. A pre-approved loan is a letter from the lender showing the maximum amount the lender will give you to buy a house.
The pre-approval shows the seller that you have the funds to pay for the house. They only deal with serious buyers since the process of putting a house on the market is challenging. They have to list it, show the house to potential buyers, and evaluate the offers.
When they accept the offer, they have to take it off the market. And when the deal does not push through, the seller goes through the whole process again. So, a pre-approved loan shows the seller that you can follow through if they sell the house to you.
With interest rates still low, it is a good time for you to buy a house even though the pandemic is not yet over.
Meta title: Things to Do When You Buy a House
meta desc: U.S. home sales have surged even in the middle of a pandemic. Find out what you need to do if you’re planning to buy your first home during a pandemic.