Buying a house is a lifetime ambition that you do not do oftentimes. It is an exercise that a buyer needs to do with a chunk of his or her lifetime savings and or including loans from third parties because a house is the greatest individual asset an individual, group or organisation can have. A house is a bundle of joy. It definitely adds to the status of the buyer in the society. It is an economic investment and serves as security for facilities. It is necessary that you know the following five things before buying a house if you are aware that it is the sellers' market, "caveat emptor":
Asking price
You will need to know the asking price of the property. Asking price is the amount that the owner of the house or the vendor is asking for. Ask whoever is in charge of selling the house if the sale price is inclusive or exclusive. Inclusive means it contains professional fees like agency fees and legal fees. You will also need to know the property tax payable by you on the property and the necessary repairs that must be done before the property will be habitable or tenantable. Check the electricity bills to see if there are liabilities incured by the last occupiers. Ask the local council if you will incur any liabilities from them for purchasing this property. You will also need to know the price of recent sales of similar house/s and the "rent passing" to decide on the offer price of the house. Also, you need to know if buying the house is necessary and where to get money to pay for it. Consider your long time commitment to educating your children, going for holidays with your wife and so on.
History of the house
Ask the vendor for the documents of the house to enable you check the year of construction and the original design of the house. Check if there has been alteration or conversion. Ask the local authorities if the alterations and conversions noticed by you are legal or if they will attract penalties. Check round the house for any structural failure or sign of leakage on the roof. Ask questions about leaking roof and when last repairs were done. You will also need to know those people that lived in the house in the past and if they were owners or tenants. Check the materials used for the construction of the house and if they are easily available for repairs. Location of the house and Market situation of the area.
Location and Market trend of the house
A house can serve as security when procuring loans. You will need to know the market trend of the house you are buying based on the location. Think along the line of the purchase as an investment and consider the purchase as if you were to pay interest on mortgage facilities for the house. Look around the vicinity of the house to check for foreclosures. Will you be able to sell your property at reasonable price plus interest if you decide to sell in future? What is the location brand like? Is the location a high quality brand or low quality? What is the average income of residents in this location? What is the average price of houses there?Ask your neighbours questions that borders on security and actions of youth and others concerning anti-social behaviours. You need to know the market trend, that is, the appreciation rate of the capital value of the house. You can ask estate agents, property brokers or realtors around for clues. This information will help you decide whether it will be a worthwhile investment. You should also know the rent that can be paid by tenants or renters and use this to capitalise the investment using current yield rate of the location.
Services availabe
You will also need to know the plumbing condition, the electrical condition, the electrical system used, that is, if it is embedded surface system or conduit system. The nearness of the property to social services like shopping centres, hospitals, schools, bus stops, train stations, dental practice, down town (city centre) etc, are also necessary. Check if there is neihgbourhood development association and the cost of being a member. As from December 1, 2008, anybody buying a residential house in United Kingdom will be given a Home Pack that contains (1) A Property Questionnaire that details the inventories of the property, (2) Vauation report and (3) Energy report, which document the energy rating of the house. Also, find out how close or far the house is to shopping areas, train stations, bus stops, schools, hospitals and medical facilities, parks and recreation areas, fitness and wellness centres, offices, industries, etc.
Nature of the contract
The nature of the contract you are entering for buying the house should be known by you. You will need to know if the house is a leasehold or freehold. A leasehold is a contract for a term less than hundred years. After the expiration of the term of the lease, the land and the property on it ceases to be owned by the Lessee (the buyer) and becomes the property of the landowner (Lessor). There may be or there may not be clause for renewal of lease in a leasehold. A freehold is a contract for eternity. The buyer and his or her heirs or successors-in-title are the perpetual owners of the property after the demise of the buyer (Freeholder). If the house has a leasehold contract, check the unexpired lease and pro-rate the value of the term to the value of another recent sales in the neighbourhood.
A buyer of a house has the right to investigate and know all the things he or she should know before committing his or hardearned money. If he or she does not exercise patience and commit himself or herself into buying a run-down property, he or she would find himself or herself to blame. If the buyer lacks the professional competence to find out and know the five issues above, he or she should employ the services of a realtor in America or Chartered Surveyors in United Kingdom and other European countries.