How to Transition From a Renter to a Homeowner With Ease
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Becoming a homeowner may be both thrilling and worrisome. When the paper works are signed and the keys are in your possession, that’s when the real job begins.
Most renters hope to one day finance and purchase their own homes. After all, there are several advantages to becoming a homeowner. Unlike renters, homeowners have equity in their homes. Homeowners also have the option of upgrading their houses as they see appropriate, with the goal of recouping their investment later.
Here are some key concepts you need to consider if you want to make the transition from renter to a homeowner as smooth as possible.
Before You Buy
The easiest approach to ensure a seamless transition to your new house is to start looking before you buy. A thorough examination might alert you to any existing issues with the property. New houses shouldn't have many problems, but it's always a good idea to have an inspection to make sure everything is in working order. The following stage after the inspection is to concentrate on your budget. It's a good idea to incorporate a home repair and upkeep plan into your monthly budget.
When purchasing an existing home, though, the situation is different. Thousands of ringgits can be spent on new roofs, kitchen renovations, and plumbing repairs. Unless you are willing to make do for a while, you will need to save aside a considerable sum of money. While certain upgrades, such as bathroom remodels and new flooring, are optional, more significant concerns that endanger tenants' safety are not.
Understand the Costs of Buying a House
It’s more to it than just the mortgage payment, though. It's a good idea to compare your current rent payments to your anticipated monthly owning costs. To estimate your future post-purchase expenditures, add the principal, interest, taxes, and insurance together.
Here are some house ownership fees to think about before you buy.
- Property assessment fee (cukai pintu).
- Quit rent (cukai tanah).
- Homeowner’s insurance.
- Homeowner’s management fees.
Keep these costs in mind as you decide how much you can afford to spend on a home.
Check Your Credit Score
It's never too late to check your credit report and start making positive adjustments to improve your credit score if you're going to buy a property in the near future. A better credit score will get you the best mortgage rates available, and a lower credit score will get you denied for a mortgage.
Think Long Term
Purchasing a house is a major financial and emotional commitment. Renting a house is a short-term housing alternative that allows you to move around freely.
Because being a homeowner limits your options, it's crucial to consider if you're ready to commit to house ownership. Ask yourself the following questions:
- Do I plan to stay in the same place for a long time?
- Does buying a home match up with my career and lifestyle goals?
- Am I prepared for the extra costs of homeownership, like maintenance and insurance?
- Is my credit score high enough to afford me a favourable interest rate?
If you answered YES to these questions, then you may be ready to become a homeowner!
Consider Resale Value
Tenants may reside in popular areas without having to speculate on future house value trends. Buyers, on the other hand, should choose places with a history of appreciation over popular but raucous neighbourhoods that may dissuade prospective purchases.
For some, completely open-concept homes with no traditional dining or living rooms may create a sociable atmosphere, but for others, they may deter purchasers. Regardless of current design trends, many purchasers still like to have specific rooms in their homes for formal entertainment.
Find Your Dream Home
Now comes the exciting part: discovering your ideal house! For a variety of reasons, hiring a real estate agent to assist you with the process is critical in today's market. Hiring a professional who is familiar with the market, capable of bargaining, and ready to spend time finding you the ideal property will save you time and money.
Buying a house is one of the greatest and most significant transactions you will make in your life, so make sure you do it correctly.
The views and opinions expressed in this article are those of the authors and not intended to malign any company, individual or necessarily reflect the official policy or position of any agency or organization. Focal Times is a subsidiary of Maxworld Consulting Sdn Bhd, a regional organization founded by a mixture of agile and experienced corporate finance, venture capital and industrial experts. This establishment focuses on sharing current banking affairs, latest property developments and updates and more.