Questions to consider when buying property
Choosing a new home is one of the biggest decisions that a person can make over their liftetime. Often though, having had only a couple of short viewings and without asking necessary questions, potential buyers are forced to make a massive financial choice very quickly if they are looking for a prompt move.
With that in mind, Landlord News has devised a list of questions that all people must consider before purchasing a property.
Money Matters
Is it affordable?
It may seem fairly obvious but interested buyers must make sure that they can afford a property before making an offer. If a person attempts to purchase a property outside of their price bracket, they will encounter problems later in the process. This could be when applying for a mortgage or when monthly repayments become too steep.
People must consider two things, which will ultimately shape their budget. The first will be how sizeable their deposit is. With rates having tumbled over recent times, mortgages are available for as little as 5% deposit. However, the more money that a person is able to save will be reflected by increased options. By saving enough for at least a 10% deposit, these savings will influence and cap how much can be borrowed.
Monthly installments
The second factor that will shape a budget is how much a lender can afford to repay each month. By making a list of all incomings and outgoings, a person will be able to ascertain how much money will be able to be paid towards mortgage costs. Additionally, this will assist in helping to decide the size of a mortgage that can be afforded.
When working out monthly sums, the costs of actually purchasing the property must not be forgotten. Mortgage fees, solicitor’s costs, surveying charges, removal costs, stamp duty-the list can be extensive and costs can spiral if people are not well-organised.
What if rates increase?
The implications of any rate increases must also be factored into a budget. Rates are widely expected to rise during this financial year. Despite rates being forecasted not to rise above 3%, potential buyers must prepare for the significant increases of 6% and above. This will leave money aside for any unexpected price hike.
Life changes
Savvy homebuyers always think about affordability during the entire period of owning a property. Of course, some things that life throws at us are unavoidable but if buyers know that their lives are about to change in the near future, they should factor associated costs into their budget. For example, if a person plans to have a child in the coming months after moving into a property, affordability during maternity leave must be considered.
Property predicaments
Will it work in the long-term?
All property purchases should be considered as a long-term investment. Due to the financial implications of buying a property, it is unlikely that anyone will be able to or even want to move on a regular basis, with the exception of unforeseen circumstances.
With this in mind, homeowners should consider things like if their family is going to grow up over the period that they will be living in the property. This will mean that their children will be going to local schools, which will need to be considered before buying a home, along with other factors in the neighbourhood. It is pointless finding a perfect home for today if it will not be right in the near future.
Questions to consider when buying property
Does it require too-much work?
As a general rule, the more work that a property requires, the better the value for money. Properties requiring lots of work can generally go for less, but that does not always add up to a bargain.
Buyers who are considering a property that requires work must ask themselves a number of questions before agreeing a deal. Do they have the necessary skills to carry out a project? Is there enough money left over from their budget? Do they have the time to complete a task to a high standard?
Is there a chance to add value?
Carry out improvements on a property will always add value but buyers should consider other factors that will add value in the long-term. Features such as loft conversions or adding an extension to a property will certainly increase market appeal, especially if other houses in the area have benefited from the same improvements. Furthermore, energy efficiency measures such as loft and cavity wall insulation could also be considered.
Location, location, location
Interested buyers will need to weigh up a number of considerations when looking for a property, but location is high up on the list. As mentioned, factors such as schools and a friendly environment must be looked at for people with children. However, further considerations, such as the commute to work and proximity to public transport routes could all be big factors for some people choosing a home.
Potential suiters should also visit the area at a number of different times. If the area becomes a car park during rush hour or changes after dark, then buyers will need to know before paying a deposit.
Consider carefully
Surveying success
All buyers should arrange for or ask to see results from a full survey of the property. A number of factors can arise from a survey, such as asbestos in the tiles or recent movement in the property. Buyers should carefully look at a survey of the property with their solicitor before agreeing to a sale.
Search thoroughly
There are a number of potential searches that can be carried out, but would-be buyers should first consider a Local Authority search. This will show-up issues that are not apparent, such as if planning permission has been granted for new roads or local developments. All issues should be highlighted with a solicitor, so the severity of all issues do not come as a nasty surprise.
Enquire about enquiries
At an early stage within the buying process, sellers should produce a document outlining important features about their experience of living in the property. These could include disputes with neighbours, boundary rules or any upcoming planning work.
This document should be studied carefully to ensure that buyers are aware of what that may have to encounter when moving into the property.
Look twice, or more
Normally, first viewings are when buyers get a feel for the property and ask themselves if they could see themselves living there in the future. A second viewing is normally different, with potential buyers examining features of the property more closely. This could involve looking for signs of damp, assessing the boiler and the plumbing.
Buyers should not be afraid of asking whoever is conducting the property lots of questions about any issues that they have. Additionally, if purchasers would like another look at a property, they shouldn’t be afraid to ask. They should remember that they are making a substantial life choice and are spending considerable money, therefore everything needs to be just right before a signature is given.
