How Much Home Can I Really Afford?

Whether you are buying your first home or another home...take the time to figure out how much home you can really afford.

Are you thinking about about buying a new home?  2013 is a great time to make a move in the Hampton Roads  real estate market. Interest rates are at historic lows. If you research and compare today's 30-year fixed-rate average of between 3 and 4 percent to the mid to upper teens of the 80's you'll see why everyone is excited about the great deals to be had!

Right now homes are now at their most affordable on record. Across the nation, and in Hampton Roads, home values have dropped. Additionally, there is also a supply of distressed properties on the market which can sell for steep discounts.

With all these awesome deals, it's easy to get excited and perhaps even get carried away.  Keep in mind the lessons learned by millions of homeowners...buy within your means. Just because you're approved for a certain amount does not mean a) you should spend that much or b) you can really afford that much.

So, how much home can you really afford? Think about the following questions:

How much do you make per month? If your pay fluctuates (i.e. such as commission work), it's critical to consider both high and low income months.  If you make a steady paycheck (i.e. a salaried job), it is simple to calculate, review your paystubs.

How much is your monthly debt? Look at your reoccurring monthly cost of car payments, credit cards, student loans, child support, alimony, and other debts that must be paid each month.

Job market...Is your job secure?Today's job market is a little shaky.  Could you still make your mortgage payment if you lost your job?   

How much does it cost you to live each month? This will be different than your monthly debt. These are the extra expenses we all have...these include utilities (gas/electric/cable), internet and cell phone, gas, groceries, entertainment, shopping, any travel, etc.

Longevity...How long are you staying? Homes do not, and will not, appreciate as they did in the last decade.  In order to build equity you need to commit to staying for at least five years (or plan on keeping the property and leasing it).  

How much money do you have in savings? In an ideal world, your lender would like for you to put at least 20% down, in addition to any closing costs.  Do you have $60,000 to put down on a $300,000 home?  If you don't, you will have to obtain Private Mortgage Insurance (PMI).  This will add to your monthly payment.

Your best bet is to find a good mortgage officer to help.  They are the experts...they can help you figure out the correct amount you can afford.  Give me a call at 757.754.3107 or email me at homes@duncanmacleod.info and I'll be glad to point you in the right direction.

What I want to be when I grow up...

So, my daughter is in the process of looking at colleges and deciding where she wants to apply. I've asked her the question, "What do you want to be?" a number of times.

There has always been the expectation that she (and her brothers) will go to, and graduate, college right after high school. Where can you get these days without at least a Bachelors degree? A lack of one has caused me to hit a glass ceiling.

But is it truly the right advice to harp on getting a degree? Or should I emphasize the idea of finding out what she loves to do and then find a way to make career at that?

While it is true that a degree is often necessary, is it the only way to have a successful career? What's wrong with going to a vo-tech school (or equivalent) to get certified in a trade?

There will always be a need for HVAC technicians, car mechanics, plumbers, electricians, hair dressers, etc. I think that as a society we often push the idea that in order to be considered a success (or rich) that you have to have a degree and a white collar job.

I hope that she decides to go to a good college (with a great football team! Lol) and loves it. I hope that she chooses a career path that she will enjoy and excel at. I hope that she is happy. Not sure I can ask for much more than that.

As for me? I still don't know what I want to be when I grow up. ;) For now though, I'll settle for being a good father and husband, a good Chief and a successful real estate professional.

Sea Shore reaches another milestone...

I've seen and experienced Sea Shore Realty's tremendous growth over the last eight years.  It started in a little, itty-bitty office on the 2nd floor.  There was barely enough room for a desk and a copier.  My broker actually had a space cut out of the roof so she could have an "office."

in 2013, this phenomenal company has already ranked in the top 10% in sales for real estate brokerages in the Hampton Roads area...the only non-national franchise brokerage to do so.  

Sea Shore Realty has reached another milestone...we are moving from our current location on London Bridge Road (home for the last 8 years) to the corner of General Booth Blvd and Gunn Hall Dr.

Our contact info remains the same as does our top notch service.  When you have a chance, stop by to say "Hi" and check out the new office.