Real Estate Search Direct

“How much house can I afford?” is a question on many first time home buyer’s minds.  There are are many different factors involved in determining what kind of house, size of house and location you can afford to buy.

Listen to Ben’s story.  Ben had always wanted to buy a house.  He saved from the time he first got a job.  By the time he was 24 he had saved $20,000 for a down payment and figured he was ready to own his own home.

Ben had an income of $4,000 per month and with his down payment he figured he could buy a $200,000 house with 10% down.  He planned to live in the house he would buy for a long time so he could pay down the mortgage and be debt free before he retired.

Ben wanted to buy a house with a yard and enough room to raise a family.  In the area Ben lived and worked he knew that there were single family homes for sale of the size he was interested in starting at $320,000.  What do you think Ben should do?

This is a common problem when people have the idea that they should live in the same home for their entire life and pay off the mortgage.  In more expensive housing markets it is difficult to plan to buy a house that will be suitable long term.

What can you do to be sure you are properly prepared to get the house that will suit you?

• Create a complete financial plan
• Determine what you can afford for a monthly payment
• Determine how much you can put down
• Plan ahead for marriage, kids, college, vacations and other life changes

These and other topics are discussed at length in various posts on Real Estate Search Direct and in the Real Estate Search Direct newsletter.

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