5 Myths About Buying Residential Property
Posted by Techyscouts | Posted on 03/06/2023
Most people in California feel that they know a lot about the buying and selling of real estate because it is discussed all the time. However, there are some misconceptions that are important to note. Because real estate sales are legal documents indicating the change of ownership of a property, and the accompanying tax ramifications, the process can be more complex than it first appears. That doesn’t mean that it has to be a terrible experience. We’re here to help.
1. Is Real Estate Always a Good Investment?
This is not always the case. In areas of California where prices have been on a veritable runaway train, wages aren’t rising nearly as quickly. It’s very easy to buy “too much house.” Even if you correctly balance the cost of the house you want with your income, you might still wind up in the soup if you don’t calculate the property taxes. Therefore, it’s always a good idea to hire a real estate professional to receive proper guidance before signing on the dotted line. Additionally, not all properties are created equally. What are your goals – School District, equity appreciation, generation of income from rental property, etc.
2. Required 20% Down Payment?
This is a general rule of thumb for prudent house purchases. While it is true that putting more money down may help you get a lower interest rate, However, when purchasing rental properties lenders may require up to 50% or larger down payment. It is always responsible to check these things out before you agree to anything, and that’s another reason to contact a professional. So, contact us today.
3. Buying Being Better Than Renting
Yes, you can deduct the interest from your mortgage on your taxes. In some cases, you can also deduct some of your property taxes when you file your income tax forms. However, there are other costs to consider when buying a home. These can include:
- Possible Homeowners’ association fees
- Maintenance and repairs
- Landscaping costs
4. Offering Less Than Full Price
You might think that you can haggle your way to a great deal. In a market where there are many buyers, you will nearly always lose out to someone who offers closer to the asking price. Although, if it’s a buyer’s market (like parts of California are turning into now), then you might be able to offer less than the asking price and get away with it. With conditions the way they are now, a seller might just ignore lowball offers. With today’s higher interest rates, the real estate market does seem to be changing from a Seller’s market into a Buyer’s market, even so this is not true everywhere in California. As a professional Real Estate Broker, Mike Millea, will know the way the winds are blowing in the market and will be able to advise you on the best course of action. Call us today.
5. Should You Pay for a Home Inspection?
You’d test drive a car before buying it, wouldn’t you? Houses generally cost significantly more than cars, so it’s just good sense to have a proper home inspection before you accidentally wind up with a money pit. We can always help you locate a reputable inspector, so call us today to get started.