Getting the Right House

Knowing what you need is the "art" of house hunting. It's like buying your own ideal outfit - others can suggest, but only you know if it's you.

Let's use an example. We'll assume you are a middle class earner, and you've been living in a rental apartment. Your rent has been reasonable, and you've been very comfortable paying that rent. You have been able to save some money for a down payment while paying this level of rent, but not a lot. If this sounds like you, then there are a few things you need to think about. First of all, even if the bank approves you for a much higher amount, you'll likely do best if your mortgage payment is around the same amount as your rent. Why? Well, at this level you've been able to do some saving, but not a lot! And, once you own a home, you'll have more than your mortgage to pay. You'll also have property taxes. You'll need some breathing room to allow you to cover those occasional extra costs that come up when you're a homeowner.

Perhaps your financial footing is much better than this. You have a good job that pays well, and you have a spouse who is also making good money. You still might want to think about your mortgage payment first, and then consider your house budget based on the mortgage payment. After all, no one wants to be so "house poor" that they can't afford anything beyond that mortgage payment!

Many financial institutions will actually approve you for a lot more mortgage than you'd really enjoy having. This was certainly the case for my wife and me. We got approved for as much as 6 times our combined salaries! In our opinion, we'd have never had any money left over for travel, which is one of our "necessities". We scaled back how much house we bought, and have enjoyed a vacation in the south every year. This is something to think about!

Beyond the general ideas of your house budget, how do you figure out what you need in the house once you've found one in your price range? Right on our site, we have a tool that will help you. It's called our "Home Buyer's Checklist".

You can use this tool to decide what you need, as well as to evaluate a home when you are taking a tour of it. If you are buying with someone else, print out two copies and sit down with that person. Discuss what you need, and decide what is absolutely necessary and what is negotiable.

Touring a home with your significant other? Both you and your spouse can take a copy of the sheets, and both make notes while you look at a home. Then you can discuss your individual comments after looking at the home.

In general, keep in mind that a real estate agent wants to sell. As a result, they may try to "convince" you that a home fits your needs. If you and your checklist results don't agree with your real estate agent, follow your own instincts.

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