Looking for a property to call home? Buying a property is one of those milestones that many people strive to accomplish, but not everyone knows how to properly invest in a property. We’ve always known land to be an appreciating investment. However, this is not always the case.
Not all properties and houses are made the same, maintained the same, or priced the same. While most people think that buying a property would always rake in a return on investment in the long run, damages, natural calamities, and poorly-maintained surroundings can decrease the value of the property.
Here are a couple of things to consider before you sign that deed of sale. When buying a landed property, you are not only making one of the biggest decisions in your life, but you are also setting the scene for your family for generations to come!
1. Scout the Neighborhood
Always scout the neighborhood before making plans to purchase a property. Some neighborhoods have more restrictions than others, which also factors into the price of the property. You may want to consider moving into a neighborhood that matches your lifestyle as well, and would have adequate security measures in place.
Consider the regulations and zoning restrictions in different neighborhoods. You may be looking at similar properties, but the regulations for different areas may vary. For instance, a landed houses in Singapore will have different regulations and costs from a similar property in the United States.
Additionally, you may want to check the condition of the neighborhood throughout the seasons to see whether the property is in a flood zone, is close to frequent fires, or experiences heavy snowfall. You can check this by asking around the neighborhood, or inquiring at local shops and businesses. This will help you determine how your area will fare in rain, snow, or shine.
2. Check Your Situation
Consider your own personal situation: is it a good time for you to purchase a landed property? Do you have the budget, time, and effort to supervise the construction of your house? Are you emotionally and mentally prepared for the stress that comes with owning a landed property? Most of us dream of owning our own property, but not everyone is ready.
Check your own situation to see if you’re ready to purchase your own property. Consider your job stability and security, as well as your debt-to-income ratio. When possible, consult with a financial planner instead of your real estate agent to properly assess your financial situation. This way, you will lessen the chances of piling up debt for your new property.
Too many of us tend to bring ourselves to debt just to accomplish this milestone, but there are ways to be smart about buying properties. Firstly, a property should be seen as an investment that will appreciate over time, so choose your property wisely. Second, only purchase property if your situation allows for it, and avoid making an impulse decision on the purchase.
3. Consider the Underlying Costs
Even if you’ve assessed your budget for purchasing a property, don’t forget to consider the underlying costs that come with it. You’ll need to set a budget aside to inspect the property, legalize documentation, build your house, secure the land and pay property taxes. There are a number of hidden costs to consider, not just the price of the property.
Depending on your area, you may also need to pay for a homeowner’s association, building permits, land ownership permits, and more. A trusted realtor should be able to lay down all the hidden costs of the property, but it is a good idea to do your own research on the necessary payments needed for your area.
4. Look for Damaged Houses in the Vicinity
One way to assess whether the property is a good investment or not is the condition of the surrounding area. Is the area prone to flooding, or does it have proper flood control measures? Is the surrounding area nearby forests or large bodies of water? Are the sewage systems, roads, and natural resources properly maintained?
You will be able to notice the surrounding houses, buildings and shops – check to see if they have damages. An assessment of the surrounding area will be able to tell you what problems you may experience as you live in the area. Forest-lined areas may have frequent run-ins with wildlife and wildfires, while areas near highways would have noise and emission problems later on.
5. Get a Trusted Contractor
While you may have bought a good property in a secure neighborhood at a fair price, the quality of your house will determine the durability of your overall property. Only go for trusted contractors to tackle the construction and design of your home. Poorly-constructed homes may lead to property damage and degradation, which will lower the value of your landed property.
A trusted contractor will be able to give you a transparent list of all costs as well, so you won’t be surprised with hidden costs. They would also have the right experience and knowledge to properly fill out any necessary paperwork, as well as construct your home with high-grade, good quality materials that would last for decades.
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