Categories: Rev. Dr. Charles Butler,
First time home buyers are often not sure what type of property to purchase. There are 4 primary factors to consider when deciding what to buy. Follow these guidelines. Narrow down your choices and your decision will become easier. (1) Make sure the purchase price and the monthly housing payments are affordable. Affordable means you can ‘comfortably afford’ the mortgage payments with all your other monthly household expenses. You want to be able to make your mortgage payments even when facing ‘financial duress’. What I mean by ‘financial duress’ is in the event you find your income has been drastically reduced due to unforeseen circumstances such as being laid off from your job, an extended illness or experiencing a family hardship.
You must still have at least 3-6 months mortgage payments in reserves to offset a financial crisis. But this also means purchasing a home that will be comfortably affordable, and you are able to manage the monthly mortgage payments in a financial crisis. This is where your monthly household budget will become an asset to you in determining how much you can afford to spend for your home.
Remember the bank will determine your pre-approval amount based on your gross monthly income not your net income. It is no good to purchase property that is above your affordability. You might be able to purchase it but will have to work extra jobs to pay your bills. If you are always at work, you will sacrifice your time at home and ultimately become a slave to your home. It is simply not worth it.
(2) Make sure the size of the property meets your needs. It does not make sense to purchase a home that is too small just because you can afford it, but it does not meet your family’s needs –
i.e. not enough bedrooms, bathrooms, laundry area etc. Adequate affordable space is extremely difficult to find in Harlem, but take your time with the search work closely with your real estate agent. Constantly search the real estate websites and be patient. You should not be purchasing a studio apartment, if you are a household of seven people. The unit is obviously far too small!
(3) Make sure the location is safe. New York City can be a dangerous place to live. You want to make sure that your home and community is as safe as possible. Police protection and block associations will become valuable assets in this process.
(4) The quality of the schools in the community will impact your property value. Schools with lower academic performance will have lower property value than schools with higher academic performance.
The first step in the process is to attend HCCI’s Home Buyer Education Workshop. We will
help you understand the entire process. For more information on attending the workshop or questions related to the home buying process, contact Rev. Dr. Charles Butler at 212 281-4887 ext. 231 or email at cbutler@hcci.org.
