January is almost over but who says it’s too late to add more to your 2017 resolutions?
Honestly, regardless if it feels like you are already on the right track, everyone could use a little advice or a few tips especially if it’s your first time to invest in a real estate property. This is a big leap in your financial road map and could have been triggered by intentions of having your own home, looking to open a new business, or just plain real estate investing.
Here are some points to keep in mind based on insights from personal finance experts and advocates:
• Be sure to check your savings, cash flow and ability to make the purchase. Use a spreadsheet to review and check your living expenses against your income for at least the next 5 years to have a clear view of how your real estate purchase will fir your budget.
• Never buy real estate just because of marketing tactics like discounts or early move-in dates. Make sure you are able to pay the monthly amortizations for the property on a long period of time. Big purchases out of impulse will be a disadvantage and problem in the long run.
• Consider other expenses aside from the monthly amortization of your housing loan – if you decide to get one. There are expenses not initially disclosed by sales agents.
• Do your research and expand your financial literacy first. Know everything about the property you are interested in – history, location, labor, numbers, and papers. Review the contract and get the experts for tips and advices.
• Weigh the value of the property to you and the people that matter to you in 15, 30, 50 years from now. Ask yourself if you can afford it. Do you really need to buy the property or will your money increase more if invested somewhere else (mutual funds, stocks, etc)
In the end, the smartest way to do this is to think long-term, have a goal, and think of a reason why you’re doing the purchase. Not all real estate property is automatically an investment if you don’t make it as one.
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