A new home is always a massive investment. And whether you already have the money to purchase one or need a financial lender, you’ll want to cut back on the expenses involved as much as possible. Admittedly, buying a home has become more expensive than ever, thanks to property prices outpacing average earnings. Today, a typical home costs about 7.1 times the average salary of a full-time worker. So, are you thinking about buying a new home? Here are four ways you can cut costs during the buying process.
- Look for house and land packages
House and land packages are becoming increasingly popular among homebuyers looking for more affordable home deals. While many homebuyers still prefer flats, most people now focus on single-family homes with their own land. If you prefer the latter, it’s important to find the right house and land packages to allow you to own a house and acreage without breaking the bank. You can research home builders in your ideal location that offer different house and land packages as options for potential buyers. This way, you wouldn’t need to spend extra on additional costs, amenities, and services.
- Be ready to bargain
The last thing you want to do is assume that home prices are fixed, whether you’re looking for a newly built property or a previously occupied home. Homesellers are usually ready to negotiate, depending on the state of their properties. For example, a home seller may be willing to hear counter offers on a home that needs extra work like repairs and renovations. Also, some home developers will be prepared to give special discounts, especially when the market is slow.
According to some experts, whenever you’re buying a newly built home, try offering about 10% below what the developer is asking for. Take the time to pick out the negatives in a property that you can use to your advantage when negotiating.
- Consider crowdsourcing your down payment
Do you need financial assistance to purchase your new home? Perhaps you may want to consider crowdsourcing your down payment. If you have benevolent friends, colleagues, or family members, one great way to cut back on how much you spend on a down payment is to ask others to chip in to assist you. Of course, you’ll first need to be comfortable with the idea of accepting money gifts from others.
- Shop around for a suitable mortgage
How much you can expect to pay in mortgages varies from lender to lender. The best way to find an affordable lending package at the lowest rate is to shop around. The smartest thing you can do here is to contact different lenders and request their quotes without committing to them. Next, compare the quotes and pick the most affordable one. Some types of lenders you can contact include banks, mortgage companies, online lenders, and credit unions.
If you already have an active account with a bank, find out if they have special or discounted packages for their customers that you can take advantage of.