A house is considered by many individuals as their most expensive and impactful purchase. As high costs are at stake, it’s a must to be careful in choosing what to purchase. Accordingly, it’s important to consider factors like the amount of space, house type, layout, and design before making the final decision.
Buying a home can be overwhelming and stressful, especially with the surging rates in today’s real estate market. To afford one, many buyers compromise on aspects such as the number of bedrooms and architectural style. But is that really necessary?
If you are a first-time real property investor and you aim to buy a house without compromising key characteristics, there are other options you can opt for to ensure that your dream home will not strain you or your resources in the long term. Here are several housing solutions for your financial worries:
Select a Location with Lower Housing Costs
The location of a residential property directly affects its purchase price. For example, in the state of Texas, the median cost of a home amounts to $196,100, but this can spike up to $257,600 in Fredericksburg and $425,100 in Fair Oaks Ranch because these cities have a higher cost of living.
On the other hand, in Pecos and Progreso, the median house value is only $54,200 and $50,700, respectively. Therefore, if you’re buying a home for the first time, consider the location in which you’ll be residing. However, you must ensure that conditions such as access to public transportation and driveways, as well as nearby infrastructures like schools and hospitals in the specific neighborhood you’re eyeing suit your needs.
Apply for a Home Loan
You also have the option to apply for a home loan in Texas from a credible bank. Granted, a mortgage can be your biggest and most straining liability, especially since the repayment period can go up to a decade. However, by choosing an extended and flexible payment plan, you can acquire the house that you want.
This alternative can also be tricky. In fact, according to Miriam Caldwell of The Balance, it’s much more secure to use on-hand cash when buying real property. Additionally, a lot of financial advisers warn buyers against borrowing money for major investments because you don’t get returns and you’ll still be in debt.
However, this doesn’t mean that getting a loan is an absolute no-no. You just have to make sure that your resources allow you to pay for the monthly mortgage so your regular expenses won’t be drained. Also, it’s best to select a loan with a low-interest rate and look into ways to get tax benefits so some portions can be deducted upon repaying a certain amount.
Opt for Packages That Allow Installments
A turnkey purchase lets you select the land and house type from a range of designs which the developer will provide. Typically, it’s required to pay the 10% deposit, and then an agreement with the builders for the total price will be finalized. When the house is ready for turnover, payment for the balance is needed to attain full ownership.
Another option is a house and land package, which allows you to buy the block of land and then decide on the house design. However, instead of a deposit and balance, you’ll be given a building contract detailing the schedules of payment for particular construction stages.
A home is indeed costly. However, by carefully assessing your options, you can make the purchase work for your financial capacity.