New Home

Searching for new homes doesn’t have to be a stressful process. Know what you want before you go house shopping, know how much you can afford to spend, and talk to your real estate agent.

There are so many possibilities when you start shopping for new homes. It can be a stressful process, but doesn’t have to be if you remember these helpful tips! .

Why buy a used house when I can buy a new one?

Even though a new house might be a little more expensive than a previously owned one, you might actually save money in the long run. New homes require less maintenance and are more energy efficient. Also, since they have more modern floor plans and have more amenities, they are easier to live in than an older home. On the other hand, it may be much more convenient to purchase a home that is already built so you don’t have to worry about finding a place to stay while it is going up. .

Before you go home shopping…

Start out by figuring out just what you want, and how much you are willing to pay—or can afford to pay. Determine the kind of neighborhood you want to live in, how close you want to be to a downtown metropolis area, and the kind of school district you want your kids to be in. How big do you want your yard to be? What kind of floor plan do you prefer? How many bedrooms and bathrooms do you want? .

Know how to finance your home

There are many types of mortgages available for you to use when buying a new home. The most basic type of mortgage is a fixed rate loan. This is a loan that comes with a lot less risk to the lender, so it is easy to get, because payments are consistent and stable. The interest rate you pay does not change during the life of the loan. Adjustable rate mortgages, or ARMs, are a type of mortgage that allows you to change the interest rate on your loan periodically. This change is usually reflective of a change in an index, so payments go up or down accordingly. Adjustment periods, when your rate is reevaluated against these indexes, are every one, three or five years depending on your loan. ARMs provide lower interest rates on average, at least initially, and if interest rates decline or remain steady over time you could end up saving a lot of money, but there is major risk to you because of the possibility of future rate increases. .

Common mistakes to avoid when house shopping

Make sure you research the local market for new homes before making your purchase of a new house. Real estate agents often take advantage of buyers who call from out of town or are in a hurry to buy a home, because they can rush them into buying an expensive house or one in a less favorable neighborhood. You’ll regret making a quick decision without checking neighborhood alternatives, school district quality or local crime rates. .

Think outside the box when inspecting new homes for things realtors call “economic obsolescence,” or obvious and incurable defects. These include problems such as poor floor plans, close proximity to a noisy freeway, or heavy street traffic. You want your home to be both a nice place to live and a good investment—homes are most people’s biggest investments, so don’t jeopardize it by purchasing something you’ll end up disliking. .

Don’t be afraid to question your real estate agent thoroughly before purchasing your new house. He or she might know more about the property than you think, and might be hesitant to share the information with you in hopes of completing a quick sell.

A REALTOR® is a real estate professional who is a member of the National Association of REALTORS®