prerequisites of home ownership<\/a>. Although it may seem counter-intuitive, one of the most important things to ask yourself when you start looking for a house is: “How easy will it be to sell this thing?”<\/b><\/p>\nSound personal finance decisions usually involve thinking one step ahead. You should not be content just to get into a house that you emotionally fall in love with; rather, you should be looking to buy a house that you can get out of quickly, easily, and at a profit should life happen to throw you a curveball that will force you to move.<\/p>\n
What characteristics lead to a house being highly “marketable”? Granted, there’s not an exact set of criteria that will be ideal for all people in all situations and markets, but the more factors you have working in your favor the better. We’re not talking about buying a house for the purpose of flipping it.<\/i> We’re simply talking about buying a house that you can live in, put some sweat equity into over time, and then sell for a profit.<\/p>\n<\/span>Unexpected Moves Can Happen to Anyone<\/span><\/h2>\nWhen I purchased my first home 3-1\/2 years ago, I was thinking I would be in it until I was able to pay off my mortgage. I loved the location, the house, and the neighbors. My wife and I both had solid jobs. It was also a house that we could grow into: 3 bed, 1.5 bath, 1,500 finished square feet, full basement, and a nice yard \u2014 all in an area with a low cost-of-living and high quality-of-life.<\/p>\n
Fast-forward 2-1\/2 years: a fantastic job opportunity presented itself. We decided it would be best for us to sell and move two hours away. Thanks to some smart thinking before we bought the house and some elbow grease, we were not only able to sell the house in just three months, but make a 10% gain on it in a horrible market. Additionally, we were able to do this via “for sale by owner”.<\/p>\n
As you shop for a home, keep in mind these characteristics<\/b> that not only make it appealing to live in now, but will make it have greater equity in the future (thus making it easier to sell).<\/p>\n<\/span>The Right Size<\/span><\/h2>\nYou need to not only look for a house that fits for you, but also that fits for the majority of the population. Here’s what the majority of households are looking for or are able to adapt to:<\/p>\n
\n- Look for a minimum of three bedrooms and a maximum of four. Two bedroom homes mostly cater to single people or couples that do not or will not have children (and aren’t concerned with selling their house). At the same time, homes with five bedrooms or more cater to those who have a healthy number of children, or plan on having them in the near future. That makes three- and four-bedroom homes the perfect size for the majority of the population, with three bedrooms being ideal. If you haven’t noticed, large suburban homes that are energy drainers are quickly going out of style.<\/li>\n
- In terms of number of bathrooms, 1-1\/2 or 2 will make the home more desirable than just one. If you’re looking at a house that could cheaply add another half or full bath, you might have a good find.<\/li>\n
- Square footage is important, but not quite as much as the number of bedrooms. Typically, you’ll want more than 1,000 (with room to expand) and less than 2,000 for a home to be comfortable and efficient for the majority of the home-buying population.<\/li>\n<\/ul>\n
<\/span>Curb Appeal That is Ripe For Improvement<\/span><\/h2>\nWhen it comes to selling a house, the biggest challenge is getting people in it. The key is to find an attractive home from an architectural perspective that needs aesthetic upgrades. Consider yourself lucky to find a home with an ugly paint color and really poor landscaping. These are two things that you can spruce up on the cheap with a little sweat equity.<\/p>\n
If you’re willing to get up on the roof, a home with a poor roof may present an opportunity to get a credit during the bidding process (with a recommendation from an inspector) that is worth the price of a professional doing the job. You can then turn around and buy the materials and do it yourself, while pocketing the remainder of the money to apply towards your loan or other projects. Our current home has an older roof with a few warped pieces of wood sheathing. We were able to get a $6,500 credit for a project that is costing just $2,000 to do on our own.<\/p>\n
On the extreme end of things, our current house had an ugly asphalt driveway that was falling apart. What was attractive about this is that the driveway is only about 25 feet in length so tearing it out and replacing it only cost us $1,700. Now, it looks great!<\/p>\n
Here are some other cheap ways to improve a home’s curb appeal before you sell it:<\/p>\n
\n- Paint the shutters<\/li>\n
- Power wash everything<\/li>\n
- Refinish the porch<\/li>\n
- Add landscaping that looks great year-round<\/li>\n
- Water the grass until it’s the greenest on the block<\/li>\n
- Add a nice new mailbox and address numbers<\/li>\n<\/ul>\n
<\/span>Good Structure<\/span><\/h2>\nWhen it comes to buying a home, you want to avoid major structural issues that will cost you big money to fix or will diminish your leverage when it’s time to sell if you haven’t fixed them. Here are a few of the biggest culprits:<\/p>\n
\n- Do not buy a house that has issues with the foundation. If you see large cracks in the foundation outside or on the basement walls, or the walls look like they are caving in some spots, kindly leave the house and look elsewhere.<\/li>\n
- Termite or carpenter ant damage is common in some locales, and it may be hard to find an older home that hasn’t had a little damage at one point or another. The key here is to find a home that does not have major structural damage and has no signs of current issues. Some home inspectors will actually insure for a year or more that there are no current signs of infestation, and if they appear, they will cover the costs to terminate.<\/li>\n
- Have you ever walked through a house that makes you feel claustrophobic or just didn’t feel right? Odds are that other people feel that way in the same homes. Don’t buy them. This may be remedied by knocking down a wall or two in some homes, but that can be an expensive project and you may be risking structural damage.<\/li>\n
- Avoid buying a house that has signs of mold or water damage. They can be very expensive to fix and usually are signs of larger foundational or roof issues. Here again, a good home inspector will be able to test or look for both.<\/li>\n
- Beware problems with the electrical and plumbing systems. These are a home’s lifeblood, and replacements are costly.<\/li>\n
- If you buy a home with an ancient furnace, you may want to have it checked out beforehand. Any home with steam radiant heating may cost you a pretty penny to heat or replace.<\/li>\n<\/ul>\n