How to Buy Your Dream Home without Going Broke

 

At a very young age, we dream of having our own home – a place where we can start reaching for our goals and eventually, where we can start our own family. We are super excited for this day to come. However, when you consider the financial aspect of buying your dream home, it can be seriously overwhelming. According to the International Business Times, the price for houses in 2017 won’t increase but the mortgage rates will soar. Last December 29, the mortgage rate hit 4.32%. Based on the data of U.S. Census Bureau, the average selling price of houses is $360,900 and the median is $312,900. For those who want to buy a new home, it can be frustrating and discouraging.

But despite all of these, you shouldn’t get discouraged because you can still buy your dream home without going broke. There are several ways that you can do.

First, learn how much you need in order to buy your dream house. There are several factors that affect its price including the location, security, establishments in the area, appraisal value, upgrades and updates, and much more. It is important to be financially prepared so that you won’t accumulate debt that will make you work until the day you’ll die.

Second, ask advice from the professionals. Working with a realtor, lender, and home inspector will greatly help you in making an informed decision. The realtor and lender may work together in order to find your dream house without you going broke. They will be able to help you get pre-approved so that you won’t have to borrow money that you’ll have difficulty paying back. On the other hand, a home inspector will help you examine the property and give you advice regarding the state of the house – whether it will need any repairs or upgrades.

Third, consider looking for homes at the lower end of your budget. Just because a property is expensive doesn’t necessarily mean that it will suit your standard of ‘dream house’. You might be surprised that the perfect home can cost a lot less than what you are expecting. Thus, you won’t go broke and you can save some money.

Lastly, save from paying little to no taxes when you buy owner occupied home. In the U.S., the tax code is favorable in this situation. If you became an owner occupant and wanted to sell your home after some time, you won’t have to pay any capital gain taxes. Note that you have to live in the home for 2 out of the last 5 years in order to qualify for this exemption.