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Buying a House? Ask Yourself These Questions…

We often focus on many questions before buying a home.  We ask questions such as, where do we want to live, how much can we afford, is the surrounding school system great, does the neighborhood have a homeowner’s association, etc. But how often do we ask the following, important questions? while Buying a House?

1.  Will I be able to rent my home in this neighborhood if it turns out that I’m unable to sell it?

Many people purchase homes that are in areas without homeowner’s associations.  These associations, though sometime costly, can be a plus.  Depending on how strict the rules are, the association can almost ensure that the neighborhood stays pretty.  Not many people would bother renting out a home in a neighborhood with cars parked on the grass, junked cars sitting on blocks, unsightly landscapes, etc.  If you do find a renter, they have no incentive to keep your home looking pretty if the neighborhood is “garbage.”

2.  If it turns out that I have to rent my home later, will the renter’s payment cover my mortgage?

This question is crucial to giving you piece of mind if you ever have to rent your home.  I have friends who have purchased homes with $2000 mortgages, including taxes and insurance.  Though the $2000 is fine for the person living there, it may not be for the prospective renter. Knowing this, it is important to evaluate how much you really need to pay for a home — or have a big down payment ready to absorb the amount financed.

3.  If it turns out that I have to rent my home, is it in an area where I could find a property manager?

Sometimes this is unavoidable, but if it can be helped, make sure you look for property managers in the area.  If the number of property managers are limited, you may find yourself competing for their attention. Thus, you will probably pay higher fees or end up with negligent management when property is competing for service calls. If there are no property managers, you may find that you’ll soon become a long-distance landlord.

Readers:  Are there any other questions one should ask themselves before buying a home – non-financial related?

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