If you are looking to buy a home in Idaho Falls, or any of the wonderful surrounding cities, you know that this can be a stressful experience. However, East Idaho’s real estate market is continuing to grow and flourish, which means that now can be an amazing time for your family to find your dream home.
Here are a few reasons why buying a home in East Idaho today is a great idea:
Idaho Home Prices are Rising – Here in Idaho, home prices are on a continual rise – meaning that waiting to buy a home may not be in your best interest. As home prices are estimated to rise over 5% in the next year, your dream home may be much more expensive this time next year.
Idaho Mortgage Rates Going Up – Along with home prices, mortgage rates are also expected to rise over time. This can directly impact your monthly mortgage payments! If you start the process of buying your home now, you could end up paying much less than you would in the future.
You’re Always Paying a Mortgage – If you are currently renting, you are still paying a mortgage – it just may not be yours… While your landlord is thankful for you paying their monthly mortgage, you are better off paying your own. Did you know that most mortgage payments are about the same cost as monthly rental payments? That’s right! Buying a home may not cost nearly as much as you think!
You Need Something New! Why Wait? – Everyone wants a little change in their lives from time to time. Whether your family is growing, or you just want a change of scenery, now is the time to buy. Since home and mortgage prices are rising, this should help motivate you and your family to pursue change! If you are needing a change, buying a home sooner than later can ultimately save you a lot of money.
With all of this in mind, let’s go over everything you need to know when buying a home in East Idaho!
Ensure You Can Afford the Home
This one should be obvious! However, many people get discouraged when looking for homes, because they may not be entirely sure what they can (or can’t) afford. You should do your due diligence and research in order to find an ideal budget.
Here are some tips to help calculate your home-buying budget:
A great rule of thumb for finding what you should spend on a home is to look at your total annual household income and multiply it by two or three. For example, if your total annual household income is $60,000, then you should set your budget to be around $120,000-$240,000. This can help ensure that you are not committing to a mortgage that you can’t afford.
Furthermore, it is best to ensure your monthly mortgage payment does not exceed 28% of your monthly household income. Of course, this number could change depending on your situation. You may need to lower this number a bit if you have other expensive monthly bills to manage as well – such as student loans.
Find The Right Mortgage For You
Okay, now that you have put an ideal budget together, it is time to shop for a mortgage! How exciting! Typically you will want to find a lender who has a great reputation and wonderful customer service. You will be asking a lot of questions, so you should find a lender that can help you answer them! Contact me if you need any references for lenders!
Once you have found your lender, you will need to work with them to find what mortgage option is right for you. There are plenty of options available, however the most common of these will be: Fixed-Rate Mortgages and Adjustable-Rate Mortgages.
Fixed Rate Mortgage: A Fixed Rate Mortgage means your interest rate will remain the same throughout the duration of your loan.
Adjustable Rate Mortgage: An Adjustable Rate Mortgage means your interest rate will change to reflect changes in the market.
Most of the time, a Fixed-Rate Mortgage will be your best option – however it is important to discuss your options with your lender to ensure you are making the right decision!
Next you will need to apply for a pre-approval. This is where your lender will review and validate all of the necessary financial information. This includes checking your credit report, bank statements, W2s, and any other necessary documents. This allows your lender to commit to giving you the best possible mortgage and interest rates.
Tip: It is a great idea to do this now, rather than later. If you have a pre-approval in hand, you can show this to sellers to prove you are already qualified! This can drastically speed up the process when you are putting in offers on a new home.
Decide What You Need With Your New Home
This is the fun part! You get to sit down and decide what exactly you need in your new home! Do you need a big living room to accommodate your family get-togethers? Do you need a home office? How about a shed? Put together a list of everything you want that would make your new home your dream home!
It is important to note that not every home is perfect, and it might be pretty hard to find a home that has everything in your list. With this in mind, note down the things that are absolutely MUST HAVES, and which options are simply extras that you could live without (for now).
Here are a few of the most common things to think about when making your list.
- Total number of bedrooms
- Is the home close to your workplace?
- Schools in the area
These three are some of the most common things to look for. You want your home to be able to fit your family comfortably, and be close to school & work (unless you don’t mind a small commute!)
You may find that many things on your list are not absolute must-haves, and can be changed once you move in. Things like paint color, beautiful landscaping, or a hot tub are all wonderful things to want! However, you can do those yourself once you move in!
Find a Real Estate Agent to Help You House Hunt
House hunting is definitely the most fun part of this whole adventure! A real estate agent, like myself, can help you immensely in this process. A real estate agent can help put together a list of your ideal homes (based on your preferences above), help set up viewing appointments, and act as a mediator between buyers and sellers.
If you’re looking for a real estate agent! I am a trusted and licensed agent here in East Idaho. I would love to help!
Contact me to learn how I can help you!
Find Homeowner’s Insurance
Homeowner’s insurance covers all the basics: fire, theft, liability, storm damage. This is a wonderful resource to have, and often is required when buying a home. It is best to start shopping for homeowner’s insurance while you are house hunting, that way you have everything ready to go when you find a home you’d like to put in an offer on!
You can usually find homeowner’s insurance providers by shopping online, however your lender or real estate agent can typically help point you in the right direction as well! Just ask!
Put In An Offer!
Hooray! You’ve found a home that you absolutely love, and it fits within all your requirements and budget! Now it is time to make an offer!
It is important to research the property (your lender or real estate agent can help) to ensure you are putting in an offer that works for both you and the seller. You don’t want to completely low-ball the seller and lose the home to a higher offer, but you also don’t want to spend too much. So how do you find this number?
Again, your agent and lender can lend a hand, but here are a few things to keep in mind.
Look at similar homes in the area. Is the home you want to purchase prices reasonably when compared to other homes in the neighborhood? If homes are selling for less in the area, it could be a great indicator that the seller is asking too much – meaning you can try to talk them down. However, if the surrounding home prices are comparable, then your offer shouldn’t be much less than the asking price.
It is also important to find how long the home has been on the market, and what the seller’s circumstances are. For example, if the seller is trying to sell the home quickly so they can purchase their next home, then you can typically get the seller to accept a discounted offer. Yet, if the seller is selling the home casually, and doesn’t need to sell right away, then they will probably be more of a stickler when negotiating the price.
Review all of the Contracts and Submit Your Mortgage Application
Once the seller has accepted your offer – you are close to being done! Yay! However, it is very important to review all of the contracts and paperwork to ensure every single clause makes sense. You want to make sure nothing needs to be added or removed.
Pay close attention to contractual information that will help protect you if something goes wrong. For example, if you find that the home has serious physical defects that impact the structural integrity of the home. You want to be sure you are covered in these situations.
It is also great to get the home inspected during this time. This will help uncover any issues that may have not been seen in the initial walk-through. If the inspection finds that the water heater needs replaced, or an electrical issue, then you can ask the seller to take the repair costs out of the total selling price. That way you still pay the price you need, but you are not paying out of pocket to do repairs right away. An inspection can also uncover deal breakers like structural issues and mold – these are serious issues where you should probably back out of the sale completely unless the seller takes care of them.
Once your inspection is done and you have reviewed all of the contractual information, it is time to submit your mortgage application. You will also want to review any closing costs, title, or insurance fees before you sign the contract!
Sign the Papers and Get the Keys!
Before you sign anything you are entitled to do a full walk-through of the home. This ensures that nothing has been changed since the inspection and initial walk through. If everything is good to go, then your agent will help you sign all of the necessary paperwork!
When you’re ready to close the sale, you will need to bring all of the paperwork you have signed (including insurance and home inspection documents) and a photo I.D. Once everything is verified you are handed the keys to your new home!
You did it! You are now a homeowner!
The most important step in this entire process is: Don’t be afraid to ask questions! This can be a stressful time, but asking questions every step of the way can really help reduce a lot of the stress that comes with buying a home!
If you have questions, please get in touch! I’d love to help answer them!
If you need help buying a home, I am a Idaho real estate agent dedicated to helping you!
ttfiddler@gmail.com / (208)520-9588
Need help selling your home? Check out my guide to selling your home in East Idaho!