Buying a mansion, or any property for that matter, can be a difficult process as it is both challenging and time consuming.
I went through the process of buying my first home recently. I knew that I wanted to live in the city in which I work and was able to snag an amazing deal on a house. However, what I didn’t know was how much money it would take to buy this house or how long it would take me to save up the cash.
I am going to share with you some of my experiences and mistakes that I made when buying a mansion and why your business needs a blog. Hopefully, this will help you make the correct decisions and stay on track as you move along your real estate journey.
1. Decide what you want in a home.
When it comes to buying a home, there are plenty of things to factor into the equation, like price range but also if it will be your primary residence or a vacation home. Think about what kind of neighborhood and environment would be suitable for living and ask yourself what features are necessary in any new home that is on the market.
2. Find out how much your dream house costs.
No matter how much cash you have in your pocket, there is no way you can just walk into a real estate agent’s office and tell them to put in an offer on a mansion that they know has been listed for $3.5 million. I went through the process of finding out how much my dream house was worth with a few different real estate places. Here are some things to keep in mind when doing this:
a. If the house is not listed on the MLS, find out its value
b. You will pay a premium price for buying real estate from private sellers
c. Find out what the average price per square foot for homes in your area is
d. If the house is listed on the MLS, just ask for a comp sheet.
3. Factor in costs outside of just buying a house.
If you are thinking of buying real estate, even if it is not a mansion, you can determine how much your mortgage payment will be and that might be enough to make you sweat just a little bit. However, there are a few other factors that you will need to consider when buying any home , which I will explain in point 4.
4. Don’t forget about closing costs and moving costs .
Closing costs can be a real pain in the ass because they are essentially a bunch of fees that can add up to thousands of dollars. The closing costs are a set percentage of your mortgage amount and typically range from 2%-5%
5. Give yourself a deadline.
When I was saving up money for the down payment on my house, I told myself that I needed to have at least $15,000 saved by March 1st so that I would have enough cash to put towards the closing costs on my home loan. If you set deadlines like this, it can help motivate you and keep you focused and on track so that you don’t end up overspending your monthly budget.
6. Set up a separate savings account for your house .
When it comes to saving up money for buying a new home, it is best to keep the money in its own separate account. This will help you monitor your progress and make sure that you are on track with your goal of buying a new home.
7. Use the 20/4/10 rule .
This rule will help you determine how much of the down payment you should put up yourself and how much money will be required from sources outside your bank account, like loans and credit cards.
8. Don’t forget about property taxes.
Property taxes are another thing that many people forget to take into consideration when buying real estate. However, property taxes can really add up and make paying your monthly mortgage payment seem more difficult.
9. Don’t forget about the insurance and maintenance costs.
Home maintenance is a huge thing to consider when buying a home. One of the most surprising things I learned was that even though I live in an apartment building in Chicago, I still need to pay for home insurance. So if you are thinking about buying a house in a new neighborhood, find out what the homeowners insurance requirements are.
10. Factor in the closing costs as well as taking care of your taxes .
One house closing fee is normally around $500-$1,000.
11. Failing to execute, will cost you a lot of your hard earned money.
While buying real estate can be very profitable, it takes a lot of time and effort to find the right property to buy. As I mentioned earlier in this blog post, I was able to purchase my new home with an amazing deal that was offered but that may not have been possible if I would have just thrown my money into something that wasn’t gaining value as quickly as it should have.
So if you plan on buying a new home at some point in your future, make sure that you keep all of these tips in mind and execute properly so that you can be one of the lucky few who knows how to make it work.