Make a smart real estate purchase – buy based on condition

    When buying a home consider not just the offer price, but how much it will cost to own that home until you one day sell it.  The average home owner will stay in a house seven years. To calculate the true cost of buying a home you need to use this simple formula:  contract price + upgrades/repairs while you own the home = the true cost of ownership.  If the home you are buying has a roof with 5 years life left it may be fine for inspections, but you will have to replace that high dollar feature before you sell one day.  The same can be said of other items such as HVAC systems, windows, appliances, and more.  Any upgrades after the purchase will have to be paid for by credit cards, cash, or an equity line of credit.

    Make sure the purchase price is in line with the age and condition of the home.  If a house you are interested in has too many future upgrades and repairs, you might look at slightly more expensive homes that are more updated or even higher priced new construction.  With interest rates being as low as they are, jumping up in price another $10,000-$20,000 might not affect your monthly payment and down payment all that much.  It also is easier to get a slightly larger mortgage than to find the cash to do repairs after closing.

     

     

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    Gary Duda

    Gary Duda is the Broker and Owner of REMAX Action Real Estate and founder of the Gary Duda Real Estate Skills Workshop. Thousands of Virginia Realtors have benefit from Gary's teaching on topics from real estate technology, working with buyers, working with sellers, to classes to obtain their continuing education credits.

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