13 Money-Saving Tips for Buying or Selling a Home
When our family first bought a house, we were ready in so many ways – I was pregnant with our first child, plus we had little debt and good savings. We found a good home but financially it was a whole new world for us. Our mortgage payment was about twice as much as the rent we were paying each month, and the cost of maintenance and yard care took some getting used to. But years later, it’s been SO worth it! Our family now has a house we have cared for and made our own.
Here are some money-saving tips whether you’re buying or selling a home!
Starting with #1! Whether you’re buying or selling…
1. Start with a good realtor.
I cannot stress the importance of this enough. You need a realtor who is experienced and knowledgeable, who will think of details you may not think of yourself. We had an excellent realtor and are so glad we didn’t have someone cheaper and less experienced. It made the whole process easy and enjoyable for us from the beginning to the end.
You can find a great local realtor on HomeLight.com, which analyzes all real estate agents in Minneapolis so they can bring you unbiased recommendations based on actual home sales transaction data.
For Home Buyers
2. Compare financing options.
How is your credit score? If you have a lower score, you are less likely to get approved for a home loan. Or if you are approved, you’ll pay a higher interest rate (and you’re stuck with that higher rate for the life of the mortgage unless you refinance). If you aren’t buying a house right now and your credit score isn’t good or excellent, focus on improving that. Then compare types of loans – you may be able to afford a 20-year loan just as well as a 30-year loan and you’ll save more in the long-term.
3. Pay 20% down if you can.
Besides getting a better interest rate, a major benefit to paying at least 20% of the selling price is that you may be able to avoid paying private mortgage insurance. This can save you thousands of dollars over the course of the loan.
4. Look closely at and budget for hidden costs including costs of a homeowner’s association.
Living in a townhome is appealing, but there can be fees that can run up to hundreds of dollars each month for maintenance, snow removal and landscaping. These costs are added to your mortgage, insurance and taxes. Other hidden costs can include home emergencies that you may not anticipate.
5. Consider location even within the metro area.
It’s generally less expensive to buy a house in the suburbs vs. in a bigger city. Compare property taxes as well as transportation costs to get a realistic idea of what you’ll be paying long-term.
6. Buy less house than you can afford.
It’s tempting to search for a house at the high end of what you can qualify for, but consider something smaller and lower-priced. Smaller houses tend to cost less in utilities and upkeep. Plus, your financial situation may change and a pricier house may become more than you can afford in the future.
7. Get the house inspected.
This will cost you a few hundred dollars, but can save you much more in the long run. You can have the sellers take care of them or pay for them at closing, or at least you can budget for them for the future. We are so glad we had our house inspected before we signed the papers, as we found out about some needed repairs that we were able to have the sellers take care of.
For Home Sellers
8. Price accurately.
Is it a buyer’s or a seller’s market? You can price your home higher in a seller’s market, but if you overvalue your home you can drive potential buyers away. And the longer it sits, the less appealing it is. Have it inspected or appraised for an accurate price.
9. Time the selling of your house.
Spring and summer are the best times to sell a home, especially here in Minnesota. A house will look its best when not covered in winter snow, and with tax refunds and the longer days, there are many people shopping for a house so you’ll have more offers.
10. Do you own repairs or hire professionals to get the job done.
Painting is one of the cheapest and easiest ways to update and improve the look of your home. Also focus on even small improvements to the exterior, lighting, floors, kitchen and bathroom, which can make a big difference to buyers.
11. Improve your home’s curb appeal.
If you can afford to use a staging company, your home can sell for more money and more quickly. If you can’t, consider simple things like landscaping your yard and pressure washing the exterior of your home, for example.
12. Consider having an open house.
You’ll have more potential buyers, and may find out some things that people really like about the home that you can feature. (If you’re not comfortable having an open house due to the COVID-19 pandemic, consider a virtual open house.)
When you get an offer, don’t be afraid to counter offer. Don’t feel you have to take the first offer that comes your way, but don’t hold on to the house because you think it’s worth more than potential buyers do.
Of course, a good realtor can help you navigate all these steps and more! Remember, it’s YOUR home whether you’re buying it or selling it – you make the decisions and the more prepared you are, the better the result for you and your family.