Buying a house is one of the biggest decisions you will make in your lifetime, especially if you are house-hunting in Arizona. There are countless things to consider, from your financial situation to the Arizona real estate market to the local economy.
Did you know that properties in Arizona are expected to appreciate by 9.2% over the next year? Or that the average mortgage rate is 2.38% for a 15-year housing loan and 2.92% for a 30-year mortgage? It can be daunting. But it could be exciting as well. And with the right approach, you could survive this experience and even navigate it with confidence. Here are a few things you need to know to get through house-hunting in Arizona unscathed.
Your Financial Situation
You have two options when buying a house: pay with cash or with a mortgage loan. Paying in cash is much simpler and easier to close. It also allows you to forgo the interest, which means a significantly lower cost for you.
However, not everyone has the budget for this. Most people opt to apply for a mortgage.
If you are one of them, you need to take stock of your financial situation. Is your credit score higher than 620? Is your debt-to-income ratio lower than 36%? If not, you may need to make some changes first before applying for a mortgage.
Also, take note that you have to pay for 2-5% of a property’s price in closing costs and that a typical Arizona home costs a little under $300,000.
Are you confused yet? You should consider approaching an Arizona real estate agency, which brings us to the next section.
Hire a Reputable Arizona Real Estate Agency
A reliable realtor is a good ally to have in your home buying journey. The services they offer go far beyond finding and showing you houses. They can also advise you on which lenders to approach, lawyers to hire, or escrow companies to use.
The best deal for you is out there, and they can help find it.
When looking for an Arizona real estate agency, focus on the following items:
- Number of years in the real estate industry
- Number of transactions for current and past years
- Experience in dealing with houses in your price range
- Experience in your preferred neighborhood
- Review (or complaints) from previous clients
Narrow down your choices to around three realtors and interview each of them. Then find out what they know about the neighbourhood you are interested in, such as planned developments, market trends, school system, and other key factors.
Get a Mortgage Pre-Approval
As much as possible, apply for mortgage pre-approval before you start looking at houses. Getting pre-approved for a mortgage gives you a good idea of the mortgage rate and what price range you can realistically work with. It also shows potential sellers that you are a serious buyer.
Most sellers will be more comfortable showing their home if you have a mortgage pre-approval letter. It assures them that, should they accept your offer, you could get financing for the property.
Start House Hunting in Arizona
House hunting in Arizona can be a roller-coaster ride. The only thing you can expect is to be surprised, no matter how much you prepare. But with the right partner, you could minimize the downs, maximise the ups, and find the forever home for you and your family.