Choosing the right home for your needs can be a tricky one, because that initial wow factor is driven by emotions and by less practical things like forward planning. So there are a number of points that people should look at before signing on the dotted line for what they think is going to be the house of the dreams, when it actually turns out to be a nightmare.
When purchasing a home, many people make the mistake of seeing how their current life transfers to fit into the prospective new home. This is in the long run very short sighted, considering that your home purchase is one of the single largest financial decisions you are ever going to make. What you need to know is how to choose the right sized home for your needs.
1. Location, Location, Location
So it ticks all the boxes with location – which is incredibly important – always go for location, but the best house money can afford in the best area, even if it is not what you want it to be just yet. The potential growth on a neglected property in the right area is huge compared to the best looking house in the wrong area.
Capitalize on the growth factor when choosing the property, especially if it is your first home – but also make sure you have enough space – as again, it is short sighted to think you are going to double your money in two years and move again. You could be looking at five or six years at least. And if you have children, a 2-bedroom house is not going to give you the space you need later, although it may be okay for now.
2. Future Plans
Purchasing the right home is always about forecasting – what comes next? A bigger car, a family, a home office or a home gym? Are any of these things on the cards in the next few months or years, and will you have space to accommodate these things, or will there be space on the property to add on for these things? Make sure that when you are looking for a property that these things are going to be taken into account.
That said, buying a property that is just enough space for now is not a bad thing, provided there is room to move when you want to adjust that space later on. A good buy could be something that is in the right price range for you now, with enough space for you without a family, but on a large property that will give you an option to extend sometime in the future. Your payments will be less on the actual building today and you will have a few years to get on your feet financially if it is your first home.
3. Running Costs
Buying a large house – if you can afford it – is one thing, but like a car, the running costs should be included in the financial forecasting. Often a mistake is made in that people only look at their monthly payments to the bank in terms of affordability. If they can make the payments they buy the house of their dreams. But when the full running costs of a massive house hit them right between the eyes, they could find themselves in serious financial difficulties very quickly. Not all larger houses were built equally and some of the more modern homes will have green and energy saving features as standard, whereas the older homes will not. So the running costs of a new home may be much less, and it is very important to get those figures before deciding on how much space you need and how much space you can afford.
Electricity and heating are a huge cost in running any home. And when you sign for a 4-bedroom house with each bedroom being en suite, you may think you have hit the jackpot. The cost of running 4 bathrooms, with multiple water functions (bathtubs, showers, bidets, sinks…), lighting and that kind of thing, suddenly takes your monthly utility bills through the roof. So ask yourself if you really do need all of those extra bathrooms right now or at all.
Gardens are also a pricey one that people forget about when putting together their monthly costs. Gardens take a lot of work and need to be watered and maintained. Have a look at the garden in the home that you intend to buy – do you or your partner have the time or the money to look after the garden that is there? If not, can you afford to pay someone to maintain it? How much water is the garden going to need during the summer time and can you afford a big garden at all? But the bottom line is do you need it?
The Bottom Line
When it comes to finding your dream home that has all the space you need it really all boils down to cost. Find a home that falls into your budget in terms of monthly repayments and one that is in the right area. But if the running costs are astronomical, the same as if the fuel requirements for a car outweigh the monthly repayments, you may need to go back to the drawing board and find a smaller home with affordable and maintainable space that you need.