In this video, see my top 5 suggestions if you’re planning on selling your home.
xoxo,
FAQ – Buying Real Estate in California
I’ve learned SO much in this last year of pursuing my real estate career! I’m no expert by any means, but since a lot of friends have come to me about their future in real estate I thought I’d share some of the common questions and my personal and professional observations. Most of the people that have questions are potential buyers so this post is centered on buying homes. If you have any questions about selling, feel free to contact me or comment below!
Q: How can I search for properties?
A: There are lots of sites out where you can actively search for properties, but my personal favorite to use in conjunction with my clients is Homeseekers app. It’s directly connected to our MLS system so you can see activity as we see it.
Q: I saw a house I like online, can we go take a look at it?
A: Sure! But don’t forget, it’s best to consult with a lender to get prequalified. This will help you set your budget based on your income and what you’re comfortable spending. They can also help you find the right financing options that work best for your situation. If you do this before we search for homes we’ll have really good parameters to work with!
Q: I’m thinking about buying, what do I need?
A: Well, first thing’s first. Your finances need to be in order. The best thing to do is consult with a lender or mortgage broker so they can prequalify you (aka calculate what price you can afford). What I can tell you is that you need to have a solid credit score, a down payment, and proof of solid income coming in. If you don’t have at least those 3 things my advice is to start building so you have all 3 in place. 🙂
Q: How does buying a house work?
A: To be honest, it’s a long process. But the good news is I’m here for you along the way! After you get your financials in order, the process of looking for your new home begins. You and I will sit down and really figure out what you’re looking for. Pool? Bedrooms? Location? Let’s be real, there won’t always be the perfect one – the paint might not be your cup of tea or the landscaping is a mess. But I’m here to help you sort through your checklist and make sure your top priorities for your dream home are there!
But don’t get your hopes up yet though. Let’s be honest once again (I’d never lie to you!) buying a home is a process. Finding the home you “love” doesn’t mean you’ll get it. In fact, because of low inventory of houses for sale and tons of buyers that want to live the American dream of owning a home it’s more competitive than ever. The silver lining in all this? It’s. still. possible. It’s just going to take more dedication, some patience, and a Realtor that’s ready to put in the work. *ahem* 😉
Q: Am I really committed to living in my house for 30 years? What if I want to move to a different area or want a bigger home?
A: Simple answer – NO of course you don’t have to. You’d be surprised how many people are afraid to buy just because they’re afraid of commitment lol! Just because you’re locked into a 30 year mortgage doesn’t mean you have to be stuck with that home for 30 years. If you wanted to buy a starter home or condo you have tons of options and upgrade to a larger home in the future!
Hope this answered some of your questions! Have any more? Feel free to leave them in the comment box!
xoxo,
Buying Real Estate for Millennials
A lot of people my age and younger feel like buying real estate will never be a reality for them or it’s something that you do after you get married. A lot of us don’t even know the first steps into preparing for homeownership. And how can I blame them? Managing your finances isn’t something that’s taught in school (it should be). Plus with increasing prices for homes and most Millennials living paycheck to paycheck it just seems like that dream of owning a home is exactly that – a dream.
The truth is being a homeowner takes a lot of sacrifice, I mean, saving money for a downpayment is no joke. You need at least 3.5% plus a number of other things like good credit, stable income, etc. But trust, the benefits and rewards far outweigh the sacrifice for that downpayment. So what are the benefits you ask? Why do you want to buy real estate you ask?
- You can do what you want with your home. You can paint the walls, change the floors, you can update your kitchen, you can have a pet without an increase in rent…
- It’s one of the best investments you can make. Yes, there are a ton of ways to invest your money – stocks, bonds, IRA’s, etc. But real estate is one of the most secure investments you can make. Most of the time, if you buy a home it will increase in value over time. Charlie and I bought our home in 2011 and it has increased in value by hundreds of thousands of dollars.
- Most landlords increase rent over time. If you are renting, you pay money to a landlord. Typically you negotiate a lease with said landlord for 6 months or 1 year. After that time, the landlord will likely increase your rent if you want to continue. If you buy a home, a fixed rate mortgage locks in your monthly payment over the entire term of the loan – usually 15 to 30 years. That’s a long time with no increased rent, plus once the loan is paid then you have no more monthly payment!
- You can build equity. What’s equity? It’s explained in a simple equation. How much money your house is worth in today’s market – the amount of money you owe the bank = equity. Though this number changes as the market changes just remember that real estate is a pretty consistent investment. So usually (not all the time but usually) your equity will build over time.
- Tax deductions. This is a huge benefit. You are able to take a pretty significant tax deduction as the interest on your mortgage is deductible.
- Increase your net worth. What is net worth? Another simple equation. Assets – debt = net worth. Assets can be cash, cars you own, real estate, investments, etc. Debts are normally credit cards and other loans against your name.
So, have I sold you yet? Now that you know the benefits I just want to say it’s possible. This dream is attainable. But don’t get me wrong, it’ll take some time. If you decided today that you want to buy a home there are a few things you should start doing.
- Start saving. The median price for a single family home (detached house) in California was about $566,000 in August of this year. Los Angeles was higher. So you’ll need about $20,000 in savings to buy the median price home, but you’ll need more if you want to live in LA county. I know this feels like a lot, but this is where patience comes in. Start saving, economizing your spending, and put as much away as you can. You’d be surprise how much a little bit of restraint will do to your savings.
- Take care of your credit. How’s your credit score? If it’s high, keep it up! Now is not the time to abuse your credit. If it’s low, start repairing your credit. You can do this by paying down your debts consistently and on time. The less debt you have the better chances you have of qualifying for a mortgage. Again, patience is key here. Give yourself time to make this happen, it’s important.
Let’s start with that for now. In the mean time, stay tuned! If you have questions don’t hesitate to leave it in the comments below. I’ve got more real estate content coming soon!
xoxo,