Buyers on a Budget

With low inventory, prices rising and properties getting snapped up in bidding wars it’s really a challenge for a buyer.

As a REALTOR® we learn how to change in a changing market. We have to; for our clients and for our business. Buyers and sellers however are rarely aware of these changes and it’s up to us to educate and prepare them.


The bank tells you your top budget is $160,000 to purchase a home. You’re putting 5% down and feel comfortable locking in for a 5 year term. Your payment is going to be around $800 per month not including property taxes, home insurance and utilities.


So off you go looking at homes. Your wish list is a 3 bedroom, 2 bathroom home near amenities. 6 houses qualify in your area. I always encourage buyers to go and see the properties even if they find the photos off putting. If at the end of the tour you find nothing. There is plan B.


Revisit your wish list. Do you need 3 bedrooms and 2 bathrooms? Does it have to be in town? Would you consider a different town? It’s a huge asset when property hunting to keep a spreadsheet where you can enter a home’s data (price, utility costs, taxes etc), your data (where you work) and what you expect to spend on the house data. At the end of entries it may surprise you which house is the most affordable.


Back to Plan B. Off you go again with your REALTOR® looking at homes in different areas. You find one that’s in pretty decent shape but it needs a new roof shingles and a new deck. You can’t afford to deal with that and the homeowner is not willing to make the necessary repairs. What happens now?


You talk to your lender about a renovation mortgage. If this house in particular is $140,000 and the price for the renovations are $15,000, your lender will finance the work (check with your lender to find out particulars) you are now looking at an investment of $155,000 to be financed. Often you need one quote from a contractor (they do the work, not you).


It’s not complicated, it’s just an extra step. Many of these fixer uppers have good bones and are worth the money. On the flip side there are many that aren’t. Your agent, inspector and a contractor, will help you know the difference.

Don’t get discouraged. There is a house out there just waiting for you. I’m sharing the following review from a first time buyer client that found that perfect fixer upper to show you it can be done:


My fiancé and I were very fortunate to have been able to work with Kathy during our first time home buying experience. Kathy proved herself time and time again with her thorough knowledge of the local market and home construction. With every home we viewed, Kathy advised us of any and all signs of problems, commenting on the quality of the construction, finish, appliances, etc. Kathy is very friendly and personable which really relieved any stress we had about the whole process. She is professional, very intelligent and there for you literally whenever you need her. Kathy accommodated our busy schedule and worked with us to view properties in the evenings and on weekends. We never had any doubt that we were working with someone who had our very best interests at mind. It's difficult to put into words just how much we appreciate everything Kathy did for us. I would highly recommend using Kathy for all your real estate needs. Thank you so much for everything Kathy!”   - Katelyn and Mason Hill

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