Buying a house is a major life accomplishment. But it’s a daunting process with many considerations and decisions to be made. And unless you have some experience with property investment, it’s easy to pass up on a perfect home or get swept up into a bad deal.

Whether you’re a first-time buyer or are adding another home to your properties, consider these five things when buying a house.

Location of the House

As experienced home buyers will often attest, location is at the top of the list of things to consider when house-hunting for two major reasons.

First, while you can change every other aspect of the house from the interior painting to the driveway, you can’t change its location. Secondly, a property in a great locale will remain a great asset and a profitable investment regardless of housing market fluctuations.

Of course, a ‘good location’ is subjective and will whittle down to an individual’s lifestyle and needs. An important consideration here is your home’s proximity to your job.

There are pros and cons to both living near or far from work. For instance, houses further from the city center tend to be cheaper, allowing you to save for the future. But you need to factor in commuting costs, commuting time and how far you’ll be from your family.

Other important locational factors to consider include centrality to amenities like schools and transportation options, crime rates, neighbors and potential for appreciation. All of these are factors that significantly impact your house’s resale value and ability to sell it quickly when necessary.

Insurance Costs

Does your lender require you to get HO3 insurance? Unlike auto insurance, the law does not make it mandatory to have home insurance. But if you’re planning to finance your house purchase through a mortgage, your lender will most likely require you to have it.

Homeowners insurance protects your bank or mortgage lender by ensuring they get paid in case a catastrophe hits the property. The policy protects you as well by covering the structure of your home, personal property, personal liability and unexpected additional living expenses, such as hotel costs while your home is being repaired.

How much you pay in the form of homeowners insurance costs varies from state to state and across various zip codes. For instance, Utah has one of the lowest homeowners insurance premiums at around $647 per year on average. This is considerably cheaper than California’s average home insurance cost, which is about $1224 annually.

Depending on local factors, such as the cost of the house, crime rate, and proximity to a fire department, home insurance costs in California could vary between $1100 and $3000 annually.

Also, it’s worthwhile to understand the various types of home insurance policies and what they cover. That way, you can ensure your home is adequately protected based on your location without overspending on unnecessary policies.

These are the most common home insurance policies to understand when buying a house:

  • HO-1- a named perils policy offering dwelling protection only.
  • HO-2- covers your house and personal property.
  • HO-3- the most common homeowners insurance policy. It covers your home, personal property, personal liability, medical payments and additional living expenses.
  • HO-4- renters insurance
  • HO-5- most comprehensive homeowners insurance. It’s ideal for people with high-value items.
  • HO-6- coverage for condo owners.
  • HO-7- a special cover for mobile or manufactured homes, such as RVs, trailers and modular homes.
  • HO-8- marketed towards homeowners with older and historically significant homes that would be challenging to replace.

 Single man looking for house to buy

Size- How Big is Big Enough?

There’s no one-size-fits-all when it comes to the ideal size of a house. But don’t let media glorification of large homes and mega-mansions lure you into buying a house bigger than your family needs now and in the future.

You wouldn’t buy a diesel bus for running typical errands like dashing to the grocery store and transporting your two kids to the school. It just doesn’t make economic sense. The same case applies when determining the ideal size house.

A bigger house not only comes with bigger rooms. You should also expect an expensive mortgage, higher closing costs, expensive maintenance and repairs and higher property taxes. So, don’t saddle yourself up with a larger-than-life house if you aren’t ready for these and other costs.

The ideal size of a house comes down to your personal needs and preferences. But experienced realtors say that the average person requires 600-700 square feet of space to live comfortably. That’s to say, a family of four would need a 2400 to 2800 square feet house.

Bedroom vs Bathroom Ratio

You also need to have a general idea of the number of bedrooms and bathrooms before heading out to view different properties. Opinions are conflicting on the ideal ratio of bathrooms to bedrooms.

Most realtors suggest that a three-bedroom house should have two bathrooms. Another opinion from property experts is having one bathroom less than the number of bedrooms. That’s to say that a four-bedroom should have three bathrooms: two master en-suites providing privacy to the parents and guests, and a family bathroom for the kids.

But like other aspects of the house-buying process, you know what will work best for your lifestyle and the number of occupants in your home. However, keep in mind that one bedroom more than your family needs can end up being wasteful in terms of plumbing, fittings and fixtures.

Yard Size

The benefits of outdoor living spaces range from improved health and happiness to increased home value. But just like interior square footage, a large yard can make the purchase price of the house shoot significantly, particularly in sought after areas.

And don’t forget that a big lawn comes with more responsibilities and higher maintenance costs. If you can’t keep up with the demands of taking care of your big yard and garden, you’ll probably need to hire other people to do it for you, and this only adds up to your monthly house expenses.

Of course, yard size is a matter of personal preference, but at least you’re getting the idea. So, be realistic and figure out how much exterior space is enough for your family’s needs and preferences.

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