Looking for Your Dream House?

Did you know that the best time to buy a home is usually in late summer or in the fall? According to Zillow, most new listings hit the market in April. However, demand is also highest then, so you may pay a premium price for a home. Zillow also notes that inventory is typically plentiful in August and September, and there is not as much buyer competition. These dynamics can lead to lower prices, overall. In addition, during these months, there are more houses with at least one price reduction than at other times of the year. Regardless of when you are buying, there are some key considerations to keep in mind:

Set your priorities. What makes a home location desirable is personal and depends on your priorities. An excellent school district may be most important to you. You may want proximity to a major city or perhaps you prefer a quieter, more rural location. Are you planning to live on your property full time, part time, or are you buying for investment purposes? These and other factors impact where you choose to look.

Review your surroundings. There may be natural limitations, costs, and risks to the area where you are considering buying a home. You may love the beach, but if you are buying property in a flood zone, your vision of a basement movie theatre, exercise room, and indoor pool may not be possible. Keep in mind, in some areas, flood insurance will also be required, to cover the risk. Similarly, you may love the view of the river and woods on your property, but you may be looking at protected wetlands or conservation property. Just because you own it doesn’t mean you can build on it! And, if you don’t own your view, it may not always be yours to enjoy.

Understand the costs. Whether it is a “starter home” or a penthouse overlooking Central Park, it is critical to factor in all the costs associated with a purchase. If you get a mortgage to finance a home purchase, in addition to monthly mortgage payments, you also must cover payment of property taxes, homeowner’s insurance, general upkeep, potential condo or co-op monthly maintenance fees, and utilities. We work with our clients to determine how much of their assets should be allocated to home ownership, within the context of their overall wealth plan. We can help you estimate the true cost of a home, including the initial purchase, closing costs, and ongoing expenditures.

Consider insurance and taxes. Annual property taxes can vary greatly depending on the value of your property and where you live. Currently, you can only deduct a total of $10,000 for state and local taxes (SALT), including property taxes, on your federal tax returns. Homeowner’s insurance is required if you have a mortgage and highly recommended, even if you do not have one. There is typically a wide range of coverage options, and corresponding premium payment levels, to protect against potential risks. We help you look at your complete tax and insurance situation to determine the best solutions for your needs.

Identify financing options. Should you pay for your house in full or finance it? Interest on the first $750,000 of a mortgage is typically tax deductible, so partial financing may be a good idea. Choosing a mortgage structure (i.e., fixed versus adjustable rate), depends upon your overall financial situation, time horizon, tax situation, interest rate availability, and more. We can help you assess the options and select the most appropriate financing solution.

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personal investment advice. KF Advisors is neither a law firm nor accounting firm, and no portion of its services should be construed as legal or accounting advice. If you are a KF Advisors client, please remember that it remains your responsibility to advise KF Advisors, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. A copy of our current written disclosure statement discussing our advisory services and fees is available upon request or by clicking here. Please read the expanded disclosures in the linked report.