Education and news for smart DIY landlords!
Growing family sizes, increasing incomes, and more belongings often lead to congested homes. Common signs are living rooms that double as gyms, garages doubling as storage rooms, and bedrooms with two or more siblings sharing them.
As a result, the head of the house would search for a bigger home to move into out of necessity. But sometimes upsizing might not be necessary. The problem might be due to bad furniture placement or item hoarding. This could make the decision of upsizing a big mistake.
For those who do decide to upsize no matter what, they could be rushing the entire process which can make financial and living conditions even harder. But what exactly are the roots of these problems and how should you avoid them if it happens to you? Read on and find out.
Just because you moved into a bigger home doesn’t mean you should buy more items to fill the space. Only buy new appliances and furniture that are necessary. Also, avoid changing your living habits. Most homeowners tend to increase electricity and water consumption when living in a new and bigger home. These spending decisions could really put you in financial trouble.
Don’t neglect maintaining your current home as you upsize. You will still need to sell it to cover some of the costs for your next house. Keeping your current home in pristine condition allows it to stay in its peak value. Before moving out, make sure everything is fixed. It’s also an important tip to follow if you want to sell your old home fast.
Every homeowner with a growing family is always excited to move into their bigger dream house. But don’t let this excitement make you forget to think things through. You don’t want to pay for a bigger house with a lot of hidden problems. Most importantly, you don’t want to buy a house with a price higher than its comparables in the market. Always take your time.
You probably decided to upsize because you received a promotion or found a way to increase your income. Good for you if you’re now able to qualify for an expensive loan. The problem with this is that you’re more prone to racking more debt. Meaning you could be back to being financially uncomfortable again.
Like I said, always think things through. Only get into a bigger housing debt if you’re still able to save for your retirement and pay for all of your daily needs.
Most people have unpaid debts that are incorrectly recorded. The worst part of it is that they are unaware of these recorded errors which could surprise them when securing a loan or mortgage pre-approval letter from a lender. It’s because these recorded errors can ruin one’s eligibility for a loan.
That’s why you should always check yourself on the housing loan eligibility calculator before hunting for your next dream home. Also, don’t forget to check your finances. Banks won’t approve your loan if your debt service ratio (DSR) is below their imposed limits. Consult with your desired bank first on how they can help you secure a loan based on your income.
Even if you get your mortgage approved, you still need to pay other fees such as agent commissions, lawyer fees, and many more. Before approaching a bank for a loan, see if you have cash, savings, or credit you can use to cover the aforementioned fees during the purchase process.
The problem with upsizing to a new house is that most homeowners make a decision without making a careful assessment of their current homes. You might feel that your home is too small for you when the real problem is your furniture layout or your floor plan.
Space assessment before upsizing is very important. You don’t want to get into debt for something that could’ve been fixed by a little renovation, furniture downgrade, or discarding unnecessary household items.
Remember to take your time when deciding whether to upsize or not. Pick your next dream home well by not rushing the inspection process. Study the local market of your eyed property to get the best deal for your wallet. Never change your living habits once you move into your new home. And most importantly, have enough money to pay for extra purchase processing fees.
You can find more tips for buying a new home right here!