Basics of Property Management: Screening Potential Tenants
New Homes For Sale: Are You Ready To Buy?
Jesse Obrien
When it's time for you to buy a new home, you might not realize you're ready. Or, you might think you're ready only to get snagged when making the first offer on a home you like. Get a realtor who is skilled in helping new home buyers find the starter home they need. Likewise, consider using this guide to determine if you're ready to buy a new home or if you should wait until your situation or the market changes.
You're ready to make a home commitment
Are you ready to make a commitment to a home or area for a long period of time? Have you secured a job you want to stick with and are you happy with a certain location? When you buy a home, you invest in real estate, but your investment will only grow if you give it time. In general, the average homeowner will stay in their first home—often referred to as a starter home—for around five years before selling or moving on.
You want to buy a house and stay in it for a while for a few reasons: to build equity and to avoid paying hefty tax penalties if you sell too soon. Unless you're in the market to flip a house, it's wise to buy new homes for sale when you're ready to make a more long-term commitment to the place.
You're ready to put that money down on a home
When buying new homes, you want to have the right down payment to put on the property. Aim for at least 20% down on any new homes for sale because you can avoid the mortgage insurance fees associated with loans that have more risk to them. The less money down, the more risky your loan is to a lender — and you want to have more equity in your property right away.
You don't have to put 20% down on a home, but not doing so can make your mortgage potentially higher and might not open you up to more houses on the market within your budget. If you don't have any money to put down on a home yet, consider saving until you have what you need to get into a property of your choice. Some home loans don't require a down payment at all, or a lower down payment, so consider all your financial opportunities with the money you have before going shopping for new homes.
Contact a company like RE/MAX Great Basin Realty for more information.
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For the last several years, I've used a property management firm to help with my rental properties. One of the tasks that they handle for me is screening applicants who would like to move into one of my vacant units. Their expertise has helped me lower my tenant turnover and find people who want to stay with me for years. Part of the process is a tenant screening credit check. Before any further contact takes place, my manager orders credit reports from at least two agencies. That is enough to tell us if an applicant is a good financial risk. Assuming the references work out, I meet the candidate and make the final decision. If you own rental properties, let me tell you more about the benefits of having a property manager. I'm betting you'll find this type of arrangement will work for you too.