Buying a home should never be taken lightly. With a substantial amount at stake, it’s probably one of the biggest transactions you’ll ever make in life. More than that, your home is your and your family’s sanctuary, so it has to be a place that will give you peace of mind, comfort, and joy.
With that in mind, when buying a home in California, don’t hesitate to ask important questions before you make any decisions to avoid costly mistakes and buyer’s remorse. And you’ll need answers not only from the seller and your Realtor but also from yourself.
Here are a few of the most crucial questions to ask.
- How much home can you comfortably afford?
Without the right financial preparation, your dream home can easily turn into a nightmare. Even before going home shopping, take a good look at your finances and crunch the numbers to see how much home you can afford without having to compromise on important things, such as your quality of life, a good education for your children, and so on.
Most financial experts advise homebuyers to follow the 28/36 rule, which states that your monthly household expenses should not exceed 28% of your income, and your total household debt should not exceed 36% of your income.
Household expenses include your PITI, or your monthly mortgage payments including the premium, interest, taxes, and insurance. It also includes regular homeownership costs, such as maintenance, repairs, utilities, and others.
Household debt includes items like car loans, student loans, credit card payments, plus mortgage for the home.
In addition, consider how much down payment you can make. In 2019, the National Association of Realtors reported that the average down payment made on a home was 12%. However, financial advisers say a 20% down payment is still ideal as it can help make your monthly payments much more manageable.
- Why is the owner selling?
This is an important question to ask for several reasons. First, it can give you an idea of how motivated the seller is, and therefore, how much room you have for negotiation. If the seller has to sell quickly for an urgent reason, such as to relocate for a job or to close the sale on another home, they might be more open to accepting a lower offer provided you can commit to closing fast.
The owner’s reason for selling can also reveal problems in the area or the neighborhood, or with the condition of the home. These are red flags that should prompt you to dig deeper.
One of the things to look into is if the owner is leaving because the area is prone to natural disasters, such as flooding, earthquakes, and forest fires. If this is the case, you will likely need to get additional coverage on top of the standard home insurance.
- How long has the house been on the market?
Similar to their reason for selling, this question can also reveal how open the seller is to negotiations. Find out the typical number of days a property sells in the area you’re eyeing, then compare this to a property’s days on market. If the property has been up for sale longer than the market average, then the seller might be more willing to negotiate a lower price.
As mentioned in this report, the number one reason a home stays on the market longer than necessary is overpricing. Ask your Realtor about comparable sales in the neighborhood to see if a property is overpriced, then craft a competitive but reasonable offer based on this information.
If the price is not the issue, then it could mean that something about the property is making it less desirable. Perhaps the house needs extensive repairs, or it’s not up to par with other properties in the neighborhood. This should also give you a good reason to do a more thorough review and inspection of the property, or move on to another one.
- What is the neighborhood like?
In asking this question, it’s just as important to pay attention to how the seller answers as to what they actually say. If they appear hesitant or reserved, then they might be trying to gloss over a problem or undesirable situation.
On the other hand, it’s difficult to get an objective answer from the seller alone. You need to do your own research on crime statistics, home value trends, schools, nearby amenities, neighborhood activities, and so on. Drive around the neighborhood to get an idea of how it is to live there, and if you can, ask a few residents for their insights.
If the property you’re eyeing is covered by an HOA, ask to see the HOA’s reports to assess its financial soundness. You’d also want to closely review the neighborhood’s CCRs or Covenants, Conditions, and Restrictions, which spell out community rules and guidelines on matters such as home improvements, architectural details, use and maintenance of common areas, and so on.
Work with a Realtor you can trust
With over thirty years of experience in real estate, you can count on the Manel Sousou Team to help you find the perfect home in Dublin and the rest of the Tri-Valley. We guide new home buyers through the steps to buying a house for the first time, as well as repeat buyers or seasoned investors looking for the right move up or investment property.