What are the Steps involved in the Home-Buying Process?
Buying a new residential property can be a thrilling experience, especially for first-time homebuyers. There are a lot of factors to consider when it comes to purchasing a residential property, and the home-buying process can be energy and time-consuming when you don’t have a detailed plan ready to move forward. It can be overwhelming for home buyers with a pool of listed housing on the market. To save from spending too much time on this unnecessity information, home buyers should have a list of their specific requirements including location, size, age of the building, and the surrounding environment. The changes in the distance from the city center will change the price of the house. As the home-buying process can be challenging, CBRE’s complete guidelines on the home-buying process can help eliminate risks during this process. Check out our guide to the steps involved in the home-buying process down below!
What are the Steps involved in the Home-Buying Process?
Despite what feels like a simple task, buying a house or any residential property is definitely not as straightforward as it seems. To help with your home-buying process, here are the 5 most important steps you should do before, during, and after the home-buying process.
Step 1: Conduct A Self-Evaluation
Self-awareness and learning where your priorities lay is fundamentally the first step home buyers should go through. Before many haste decisions on a property, home buyers should first evaluate their own stance in buying a residential property. These are some pointers home-buyers should consider during this step:
- Financial Capability:
Validating your financial condition is crucial before making any big purchase such as a house. As it is a part of the necessity of the household to have a decent home, a commonly allocated budget is usually 30 percent to 50 percent of the household income. This budget can be flexible base on family preferences. Having efficient financial management will ensure that even after purchasing a new house, the family will be able to live a standard quality of life even after the purchase of the new house.
- Ideal Housing Preference:
It can be overwhelming for home buyers with a pool of listed housing on the market. To save from spending too much time on this unnecessity information, home buyers should have a list of their specific requirements including location, size, age of the building, and the surrounding environment. The changes in the distance from the city center will change the price of the house. It is also beneficial that buyers have the purpose for buying the property in mind as well. In addition to the housing type, buyers should consider noting down the specific details they want for their future house: the house size, number of rooms, available space, structure, design, etc. Criteria such as property age, condition, location, neighborhood, and living environment are also important to consider too.
- Financing Options:
Once aware of their financial capability and what an ideal house would look like, buyers should also understand the financing options most suitable for them. This part will help buyers understand the finance source for their home buying. Finance sources can be personal savings, support from family, or taking loans from banks. Home buyers benefit greatly from having complete control over their future spending, which includes paying for monthly interest rates and amortization costs. Additionally, it also helps to minimize the risk of having insufficient funds to hold onto their property in the future.
Step 2: Property Searching
The second step home-buyers should take is conducting a good property search before the purchase. The property searching processes can be understanding the quoting price of the listed residential property, the price, developer profile, legal and quality aspects. Doing research will help give up an upper hand in striking a deal or during the deal-closing process later on. Some of the things buyers should know include the current market price for the residential properties, types of properties that are on trend, and areas that are developing. Buyers should also get to know the available payment method such as down payment terms, where they can get mortgage loans, as well as knowing which loan term and rate is appropriate. During this step, buyers are highly encouraged to get assistance from real estate agents to help with the process. Real estate agents can help guide buyers with properties that align with their budget, negotiate the deal, and helps with the paperwork.
Step 3: Start House-hunting
House-hunting is an exciting step for buyers to enjoy. However, it can be energy-consuming and stressful too as it is recommended to consider multiple options. With assistance from real estate agents, you will find the process to be more convenient. With the agent’s networking and property lists, they can direct you to properties most suitable for you easily. Additionally, buyers can also check out property listings on the CBRE website to find the best offers on residential sale listings. In this step of the process as well, buyers should eliminate options down to the top 3 options to choose from. Once you have the top 3 options, it is recommended that you make a property visit directly to properly check each option before making the final decision. After coming to a satisfactory decision, the buyer can start making an offer to the property seller.
Step 4: Securing Your Finance and Deal
Before reaching the final step, the home buyer has to thoroughly involve with securing both the deal and financial matters. At this step, buyers are suggested to make a final inspection of the housing property to ensure that the property is in great condition. After the inspection, the buyer can start negotiating on the price, and the terms and conditions of the offer with the seller while also securing the loan to be approved once requested. During this step, the real estate agent can help strike a good offer and with the negotiation for the buyer too. Although it will help ease some of the burdens, the buyer should participate in the negotiations talks still.
Step 5: Closing the Deal
The final step in the home-buying process is closing the deal and the handover process. This last step requires professional help with both the paperwork and ensuring that every process is done legally. Along with the assistance of the lawyers and agents, drafting the terms and conditions for the final preview will be finalized at the negotiation stage. It is important to also check your own documents and the buyer’s document for legitimacy before signing and processing the legal work. For those who requested a mortgage loan, the participation from the bank or financial representative will also be involved during the deal closing step. Once the legal work is processed, you have successfully owned the property.
Buying a residential property provides us with stability and security. Therefore, although the home-buying process can be challenging, the effort is worth it. Besides, this process doesn’t have to be as stressful with the help of real estate agents. If you want to conveniently and efficiently purchase residential properties, do not hesitate in contacting CBRE’s real estate agents for consultations and assistance.