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Can You Afford That House in Albuquerque?

by Sandi Pressley

Are you planning on buying a home in Albuquerque? If so, you no doubt have already figured out how much money you need for your down payment, the mortgage payments, and so forth.

Yet how much will that home cost after you move in? Here are six life factors to consider when buying a home:

Green Thumb?

If you love landscaping and gardening, then buying a home with a lawn will be a fun adventure. But if you’re not into gardening, then buying a home with a lawn or landscaping can cost you about $100 or more a month for professional landscape maintenance. Are you willing to skip the lawn in favor of hardscaping to reduce costs.

Make sure to factor your hobbies and services into your monthly budget to see if the numbers still work out in the black.

Pool Time

It can get hot in the Southwest, so a pool might sound like a great idea to stay cool. Yet one truth remains – pools cost money maintain. You should add up the costs of pool maintenance and servicing, energy, and insurance (along with liability if you have small children).  After you take all that into consideration, you may decide you would be better off heading to the neighborhood swimming hole.

If you plan to add a pool, don't expect to get back more than 50% of the cost when you sell your home. Yes, pools are fun, but they are an investment. Factor time and money into your future plans when buying a home with this special feature and, once again, ask yourself if the numbers add up to support your other financial goals.

Children

If you’re buying a home and plan to start a family in the next few years, don’t just consider the amount of mortgage you can afford under your current expenses. Factor in daycare costs and then determine what your cash flow will look like. You may have to adjust the amount of home you’re looking to purchase.

Entertainment

Have you taken into account your entertainment costs? Most of us like to eat out, go see a concert or a movie, or go to a game. You should add up how much you normally spend on entertainment and see how you can balance those costs with owning a home. You may love your new home, but you may not want to feel trapped in it because you don't have the money left to have fun.

Retirement

If you’re in your 20s, you should try to save 10% of your income; in your 30s, you should be saving 15%. If you need to cut back on your retirement savings to make a home purchase work, think hard about when you’ll be able to get back to your ideal contribution levels and how much you may be losing out on during that time.

Although home ownership can help build long-term wealth, it’s important to also maintain retirement savings for future security.

Check back on our blog every week for more real estate advice and local articles about living in Albuquerque. And make sure to follow us on Facebook for up to date real estate news for Albuquerque and surrounding areas.

HOT HOME LISTING OF THE WEEK!

2020 Mountaineer Drive SE, Albuquerque, NM 87123  $300,000

4 Bedrooms / 4 Bathrooms (2 full, 2 partial) / 2370 Square Feet

Casual elegance in this Incredible 4BDR/4BA with hard to find attached casita/guest suite/man cave or office!! Master Suite is on the main level!! Soaring wood beam ceilings, light, bright and open! An entertainer's floor plan with lots of space for family and friends! Fully landscaped beautiful backyard. Close to KAFB, Sandia Labs, UNM, Foothills!

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

Lesser-Known Fees That Factor Into the True Cost of Home Buying

by Sandi Pressley

Buying a home can be a tricky process, and there are plenty of little costs that can add up. How can you prepare to cover these costs?

Since most people focus on the larger costs, such as the down payment and mortgage payments, they tend to overlook the smaller fees that come with buying a home.

Here are a few of these lesser known fees and what they could cost you.

Home Inspection

A home inspection is critical to protecting you from buying a home with hidden issues that could ruin your finances. The inspector looks for structural and general issues with the home. Inspections cost between $300 and $500, and whether or not you end up purchasing the property, you still need to pay this fee. You may also have to hire a specialist if specific issues are found, such as foundation issues or termites.

Appraisal Fee

This appraisal report goes to your lender to assure it that the property is worth what you’re paying for it. If you’re selling, review the appraisal thoroughly for any oddball numbers or descriptions that could affect the value of your home. An appraisal can take about 2 hours and costs between $200 and $425.

Application Fees

Before ever approving you for a loan, the lender is going to run your credit report and charge you an application fee, often lumping the credit report fee in with the application fee. This can run $75 to $300. Be sure to ask for a breakdown of the application fees to understand all costs.

Title Services

These fees cover a title search of the public records for the property you’re buying, notary fees for the person witnessing your signature on documents, government filing fees, and more. These can cost between $150 and $400, and it’s important to get a line item for each cost.

Private Mortgage Insurance (PMI)

When you put down less than 20% on your new home, the lender requires that you purchase PMI once you reach 78% of your loan-to-value ratio or you have 22% equity. So PMI is a policy that you have to buy to protect the lender from you. PMI rates can vary from 0.3% to 1.5% of your original loan amount annually.

Tax Service Fee

This is the cost (about $50) to ensure that all property tax payments are up to date and that the payments you make are appropriately credited to the right home.

Always ask questions when it comes to understanding the fees you’re paying. If possible, print out documents and go through them with a highlighter to indicate any areas you have concerns about. Discuss them with your lender or real estate agent and determine if you can negotiate any of them down.

Don’t be afraid to price shop to ensure you’re getting the best value. Just because you’re spending hundreds of thousands on a home doesn’t mean you should be comfortable throwing thousands of dollars at fees.

Check back on our blog every week for more real estate advice and local articles about living in Albuquerque. And make sure to follow us on Facebook for up to date real estate news for Albuquerque and surrounding areas.

HOT HOME LISTING OF THE WEEK!

8309 Rancho Paraiso NW, Albuquerque, NM 87120  $269,000

4 Bedrooms / 3 Bathrooms (2 full, 1 partial) / 2276 Square Feet

You don't want to miss this picturesque almost 1/4 acre with backyard access. This is a fabulous 4 bedrooms home. Master is on the first floor. Spacious, well appointed kitchen. Light, bright wonderful family home. Pride of ownership is apparent. Balcony with fantastic views upstairs. Sought after neighborhood with easy access to all amenities. Don't wait to see this sensational home!

Contact the Sandi Pressley team for additional details! 

Get your Morning Inspiration with the Sandi Pressley Team

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