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Okay, my team was developing new educational content when one of our loan officers shared a story about a first-time home buyer. She had fallen completely in love with a gorgeous Victorian on her second showing. The hardwood floors, the original crown molding, that kitchen with subway tiles everywhere—it checked every single box on her Pinterest board. She was ready to make an offer that afternoon.
Then the loan officer asked her one question: "Did you look in the basement?"
She hadn't. Nobody had shown her the basement because the listing agent "forgot" the key. When they finally got down there two days later, they found foundation cracks you could fit your fingers into and water stains climbing halfway up the walls. The inspection estimate came back at $47,000 just for the foundation work.
That's the thing about house hunting. It's incredibly personal and emotional—you're choosing where birthday parties will happen, where your kids might take their first steps, where you'll host Thanksgiving dinners for the next decade. But finding your dream home takes more than imagining your furniture in the living room. Before you fall in love at an open house, there are critical factors you need to assess systematically.
I've worked on educational tools for hundreds of buyers navigating this process, and I'm going to walk you through exactly what to look for when buying a house in 2025's market.
Here's where we are right now. According to the National Association of REALTORS®, the median existing-home price hit $415,200 in September 2025, representing a 2.1% increase from the previous year. Meanwhile, mortgage rates have been fluctuating—Freddie Mac reported that 30-year fixed mortgage rates averaged 6.27% as of October 16, 2025, down from highs above 7% earlier in the year.
What does this mean for you as a buyer? Affordability is tight. But improving slightly. The qualifying median family income rose to $104,281 in the first quarter of 2025 compared to $99,798 a year ago, according to NAR. That means you need to be even more strategic about every dollar you spend on a home.
Think of it like this: in a market where homes are expensive and rates are still elevated compared to historical lows, you cannot afford to overpay for a house that needs major work. Every feature matters. Every red flag counts.
Let me start with the most obvious factor—but also the one people mess up most often. Price isn't just about the listing number. It's about total affordability over time.
For many buyers, the purchase price is the biggest concern. If you overspend on a house, you risk becoming house poor, where most of your income goes toward housing costs including your monthly mortgage payment. When you're house poor, saving money becomes nearly impossible, and covering other essential expenses gets stressful.
Here's what every buyer needs to understand: get a mortgage preapproval before you tour a single property. Not a prequalification—a full preapproval. The preapproval process involves a lender reviewing your financial documents, checking your credit, and telling you exactly how much home you can afford and what down payment you'll need.
At AmeriSave, we help buyers get preapproved quickly so they know their buying power before house hunting. This clarity prevents you from wasting time viewing homes that are outside your budget or, worse, making an offer on a home you can't actually afford. Learn more about our mortgage preapproval process to get started today.
When you know your numbers ahead of time, you can shop confidently within your range. You avoid the heartbreak of falling in love with a $500,000 home when you're approved for $400,000.
The textbook answer is to look at principal and interest. But really, you need to factor in the complete picture: your mortgage principal and interest, property taxes that vary dramatically by location, homeowners insurance premiums, HOA fees if applicable, estimated maintenance costs of typically 1-2% of home value annually, and utilities that vary based on home size and energy efficiency.
That $3,000 monthly payment suddenly looks different when you add $600 in property taxes, $200 in insurance, $150 in HOA fees, and $300 in utilities. Now you're at $4,250 per month before any maintenance issues arise.
This table shows why understanding your full monthly obligation matters so much. The mortgage payment represents only about 50-65% of your actual housing costs.
I was just in class learning about environmental systems theory—how everything in a person's life connects to their surrounding environment. That's essentially what location means in real estate. Where you buy impacts everything: your daily commute, your kids' education, your safety, your weekend activities, even your home's future value.
Before buying in any area, research the assigned flood zone code. FEMA maintains flood maps for every region in the United States. If a home sits in a high-risk flood zone, you'll likely need flood insurance, which can add hundreds of dollars to your monthly expenses. I've seen buyers purchase waterfront properties without realizing their flood insurance would cost $2,500 annually. That changes affordability fast.
Research the neighborhood thoroughly. Local police departments publish crime statistics, and websites like NeighborhoodScout provide crime rate comparisons. Join neighborhood social media groups too—NextDoor and local Facebook groups give you insider perspectives on what it's actually like to live there. Don't just drive through during the day. Visit the neighborhood at different times: weekend mornings, weekday evenings, late nights. See how it feels.
Even if you don't have children, school district quality affects property values significantly. Homes in highly-rated school districts typically appreciate better and sell faster when you eventually move. The Department of Education and sites like GreatSchools.org provide school ratings and performance data.
I completely understand the frustration when you find a perfect house but the school ratings are mediocre. That must have been so stressful trying to decide whether you'll sacrifice one for the other. It's a legitimate concern that affects both your family's immediate needs and long-term financial outcomes.
How far is the nearest airport? What about public transportation options? If you commute daily, map out your route during rush hour. Google Maps can show you average travel times at different parts of the day. Calculate transportation costs honestly. If this home adds an extra 45 minutes each way to your commute compared to your current situation, that's 7.5 hours per week—nearly a full workday—that you're spending in a car or on a train.
Proximity to highways, airports, train tracks, or industrial areas creates persistent noise that wears on you over time. During showings, stop and listen. Open windows. Stand outside for a few minutes. That airplane taking off might seem tolerable during a 20-minute showing but imagine hearing it 40 times per day. Actually, I don't know if it's 40... could be more like 30 or 50 depending on flight paths.
The physical space needs to match how you actually live—not just how you imagine living. This is where buyers sometimes get romantic about features they'll never use.
The average new single-family home in the United States measures approximately 2,300 square feet according to Census Bureau data, but your needs vary based on family size and lifestyle. Bigger isn't always better, especially when you consider heating and cooling costs, cleaning time, and furnishing expenses. Measure your current furniture and visualize it in the new space. That cozy living room might feel cramped once your sectional sofa arrives.
Here's what qualifies as a bedroom legally: it must have a window for egress, a closet, and meet minimum size requirements of usually 70 square feet. A room without windows isn't a bedroom, no matter what the listing says. For bathrooms, think about your morning routine. One bathroom for four people creates traffic jams. If someone's in the shower when you need to brush your teeth, where do you go?
Walk through the house multiple times imagining daily activities. Where do groceries go when you bring them in? Is there a mudroom for shoes and coats? Can you watch kids in the backyard while cooking dinner? Does the primary bedroom share a wall with the living room, which gets awkward when you have guests? Open floor plans are trendy, but some people prefer defined spaces. Make sure the layout matches your actual lifestyle, not just what looks good in magazines.
Storage space impacts livability significantly. Where do holiday decorations go? What about tools, sports equipment, seasonal clothing, that box of high school yearbooks you can't throw away but don't want to see? Basements and attics should be dry, accessible, and properly ventilated. A damp basement with 5 feet of clearance doesn't count as useful storage. Consider whether the home has a garage for vehicles and additional storage, an attic space that's finished or at least accessible, and a basement that stays dry year-round.
If you have dogs, kids, or enjoy gardening, yard size matters. But bigger yards require more maintenance. Are you realistically going to mow a half-acre every week? Can you afford landscaping services? Check for proper drainage too. Standing water after rain indicates grading problems that could affect your foundation over time.
Property taxes vary dramatically by location and directly impact your affordability. Two identical homes in different counties might have property tax bills that differ by thousands of dollars annually.
Request the last several years of property tax records for any home you're considering. This shows you the trend—are taxes stable or climbing rapidly? Has the home been recently reassessed? Here's an example: A $400,000 home in New Jersey with a 2.4% effective rate means $9,600 annually in property taxes—that's $800 per month. The same home in Alabama with a 0.4% rate costs $1,600 annually, or $133 per month. That's a $667 monthly difference for the same house value.
According to the Tax Foundation, property tax rates range from under 0.5% in some states to over 2.5% in others. Many municipalities offer tax abatements or exemptions for first-time buyers, veterans, seniors, or properties with certain improvements. Research what programs exist in your target area—they can save you thousands.
Decide early whether you want to live in an HOA-governed community. Homeowners associations regulate what you can and can't do with your property's exterior and communal areas.
HOAs typically maintain common areas, provide amenities like pools and fitness centers, handle landscaping for shared spaces, and enforce neighborhood standards that can protect property values. If you want a low-maintenance lifestyle where someone else handles the lawn care, an HOA might appeal to you. However, loss of control is the major downside. Want to paint your front door purple? Need HOA approval. Planning to park an RV in your driveway? Probably not allowed. That storage shed for gardening tools? You'll need to submit architectural plans.
HOA fees are also mandatory—you pay them in addition to your mortgage. According to the Foundation for Community Association Research, typical fees range from $200 to $600 monthly depending on amenities and services, with HOA fees in the United States averaging approximately $250-$400 per month.
Before buying in an HOA community, read the CC&Rs completely—these are the rules you're agreeing to follow. Review meeting minutes from the past year to see what issues the community faces and how the board handles problems. Check the reserve fund status because a healthy HOA maintains reserves for major repairs. If the community has a $0 reserve fund, expect special assessments soon. Ask about planned assessments because if a roof replacement is coming for the clubhouse or pool resurfacing is needed, you'll pay your share of those projects. Finally, understand the fee history to see if fees have increased annually and by how much. A community that raises fees 10% every year becomes unaffordable quickly.
Wait, let me clarify that point about special assessments. Those are one-time fees, usually hundreds or thousands of dollars, that the HOA levies when reserves don't cover major expenses. You must pay them or face liens on your property.
Community amenities make neighborhoods more enjoyable, but they should enhance your lifestyle, not dictate your purchase decision. Consider whether you'll actually use pools regularly or if they'll be an unused amenity you pay for through HOA fees. Think about fitness centers and whether you already have a gym membership elsewhere. Playgrounds are essential if you have young children but irrelevant otherwise. Walking trails genuinely get used by outdoor enthusiasts. Clubhouses prove useful for hosting large gatherings if you entertain frequently.
Prioritize amenities you'll actually use weekly. A pool you never swim in just adds to your monthly costs through increased HOA fees. If a home you love lacks certain amenities, check if nearby public options exist. A city pool two blocks away might serve your family just as well as a neighborhood pool.
Unless you're purchasing your forever home, you'll eventually sell. Certain features help homes maintain or increase value over time.
The real estate adage holds true: location is the most influential factor in property value. A home in a desirable neighborhood with good schools, low crime, and strong community character will always find buyers. According to NAR research, 75% of metro markets showed price gains in Q2 2025, demonstrating that well-located properties continue appreciating. Strong public and private schools make properties appealing to the largest segment of buyers—families with children. Even buyers without kids recognize this correlation and often prefer homes in good school districts.
Areas with growing populations, expanding business districts, and infrastructure improvements typically see home values rise. Check local development plans. Is a new light rail station coming? A major employer relocating nearby? These changes signal appreciation potential. Basic economics applies to real estate too. Neighborhoods where homes rarely hit the market but buyer demand stays strong see steady price appreciation. Low inventory combined with high demand drives values up quickly.
Research "days on market" statistics for your target neighborhood. If homes sell within a week of listing, that's a seller's market indicating strong demand. If they linger for months, demand is weak.
The home's physical condition and age determine your immediate and near-term maintenance costs. Older homes offer character, newer homes offer modern systems and efficiency. There's no universally "better" choice, but you need to understand what you're getting into.
Older homes built before 1980 often need updates to major systems: electrical, plumbing, HVAC, roofing, windows, and insulation. These aren't cosmetic issues you can ignore—they affect safety, comfort, and operating costs. According to HomeAdvisor data, replacing an HVAC system costs $5,000-$10,000, a new roof runs $8,000-$15,000 for an average home, and updating electrical systems can exceed $10,000 depending on scope.
Budget at least 1-2% of your home's value annually for maintenance and repairs. For a $400,000 home, that's $4,000-$8,000 per year. Older homes typically require maintenance at the higher end of that range or beyond. Ask sellers for maintenance records. A well-maintained home with documentation of regular HVAC servicing, roof repairs, appliance upkeep, and other care signals responsible ownership. Conversely, complete absence of records suggests deferred maintainence and hidden problems.
Certain updates increase home value when you sell. Kitchen remodels typically recoup 60-80% of cost according to Remodeling Magazine's 2025 Cost vs. Value Report, bathroom updates show similar return on investment, adding square footage through quality additions helps, and energy-efficient upgrades like solar panels, new windows, and enhanced insulation all contribute positively. Maintain quality throughout ownership. Keep appliances modern, fix issues promptly, and complete regular maintenance. Future buyers will pay more for a well-cared-for home.
Energy-efficient homes cost less to operate monthly and provide better comfort year-round. Features that improve efficiency should be high on your priority list.
Modern HVAC systems with high SEER ratings use significantly less energy than older models. According to the Department of Energy, upgrading from a SEER 9 to SEER 16 system can cut cooling costs by nearly 50%. Ask about the HVAC system's age, SEER rating, and maintenance history. A well-maintained 10-year-old system is better than a neglected 5-year-old system.
Single-pane windows leak massive amounts of energy. Modern double or triple-pane windows with low-E coatings dramatically reduce heat transfer. The energy savings often pay for window replacement within 8-12 years, per Energy Star estimates. Check window condition carefully by looking for condensation between panes indicating seal failure, difficulty opening or closing suggesting warping or damage, visible air leaks that you can detect by holding a candle near the frame on a windy day, and drafts you can feel with your hand.
Adequate insulation in walls, attics, and crawl spaces makes homes comfortable and reduces energy bills. The Department of Energy recommends R-values based on climate zone. Most regions need R-38 to R-49 in attics and R-13 to R-21 in walls. You can't easily see insulation levels, but your home inspector should check and report them. Poor insulation means higher heating and cooling costs immediately.
Homes with solar panel systems can slash or eliminate electricity bills. Some systems generate excess power you can sell back to utilities through net metering programs. According to the Solar Energy Industries Association, residential solar installations increased 19% in 2024, with average system costs declining to approximately $3-$4 per watt installed. If considering a home with existing solar panels, verify whether the system is owned or leased because leases transfer to new owners and include monthly payments. Check system age and warranty remaining, review production data showing actual energy generation, and assess the condition of the roof under panels since accessing it for roof repairs is expensive.
Smart thermostats like Nest or Ecobee learn your schedule and optimize heating and cooling automatically, saving 10-15% on energy costs according to manufacturer data. They're inexpensive to install at under $300 but offer ongoing savings.
Smart sellers provide copies of utility bills covering a full year. This shows you actual costs for electricity, gas, water, and sewer in all seasons. If summer air conditioning costs $400 monthly, factor that into your budget. Unusually high utility bills indicate efficiency problems you'll need to address—or use as negotiating leverage.
Zoning laws dictate how you can use and modify your property. Understanding these restrictions before purchase prevents costly surprises later. I think most municipalities are pretty reasonable about minor stuff, but major changes? That's where you run into issues.
Some municipalities limit additions, outbuildings, fence heights, shed sizes, and renovations. Want to add a garage? Convert the attic to living space? Build a workshop? Verify zoning allows it first. Zoning laws also govern property use. Residential zones typically prohibit running certain businesses from home. If you need a home office where clients visit, check that your zoning permits it.
Planning to Airbnb your home occasionally? Many cities now restrict or prohibit short-term rentals. HOAs often ban them entirely. Verify regulations if rental income factors into your purchase decision. Some areas have tree preservation ordinances preventing removal of trees above certain sizes without permits. Coastal and wetland areas have environmental restrictions limiting development.
Research local regulations thoroughly. Your real estate agent can help identify relevant zoning rules, but ultimately verifying regulations is your responsibility.
Four major home systems require careful assessment: roof, HVAC, plumbing, and electrical. Problems in these areas cost thousands to fix and affect daily comfort and safety.
Roofs are expensive and critical. A quality roof protects everything inside your home from weather damage. According to HomeGuide, roof replacement costs average $8,000-$15,000 for asphalt shingles on a typical home, with metal or tile roofs costing significantly more.
During showings, look for missing or broken shingles, curling edges, sagging sections that indicate structural problems, moss or algae growth that can damage materials, damaged flashing around chimneys and vents, and granules from shingles collecting in gutters as a sign of deterioration. Ask sellers about roof age since asphalt shingles last 20-25 years typically, the date of last inspection, any repairs or maintenance performed, and warranty information if recently replaced. A roof nearing end-of-life gives you strong negotiating position. You'll need to replace it soon, which should be reflected in the sale price.
HVAC failure in July or January is miserable and expensive. No one wants to replace their furnace or air conditioner right after closing on a new home. Ask about system age because furnaces and AC units typically last 15-20 years, the type of system including central air, window units, heat pumps, or boilers, heating fuel source such as natural gas, propane, electricity, or oil, maintainance history since regular servicing extends system life, and any unusual sounds, smells, or performance issues.
Have your home inspector test both heating and cooling functions thoroughly, regardless of season. A furnace that seems fine in summer might fail when you actually need heat in December.
Plumbing problems range from annoying drips to catastrophic pipe failures requiring walls torn open for repairs. Older homes may have galvanized pipes prone to corrosion, while newer construction uses copper, PEX, or CPVC.
Check pipe material and age, water pressure by testing multiple fixtures simultaneously, drainage speed because slow drains suggest clogs or venting issues, signs of leaks including water stains, mold, and musty smells, water heater age and capacity since tank water heaters last 10-12 years, and sewer line condition especially in homes built before 1980. Run all faucets, flush toilets, and check under sinks for leaks during showings. That might seem excessive, but discovering a sewer line backup after purchase costs $3,000-$10,000 to repair.
Outdated or inadequate electrical systems create fire hazards and can't power modern appliances and electronics. Homes built before 1980 may have insufficient amperage of 100 amps or less for today's needs. Modern homes typically have 200-amp service.
Watch for knob-and-tube wiring found in homes built before 1950 that creates fire hazards, aluminum wiring used in the 1960s-1970s that has connection problems, insufficient outlets where extension cords everywhere indicate an issue, flickering lights or tripping breakers, two-prong outlets throughout meaning no grounding and safety concerns, and warm outlets or switch plates indicating overheating. Electrical system upgrades cost $5,000-$15,000 depending on scope. That's significant, and if discovered during inspection, you should negotiate repairs or price reduction.
Information about home condition, necessary repairs, and property issues provides negotiating leverage. If you identify problems before making an offer, you can request a lower purchase price accounting for repair costs. If your home inspector uncovers issues, you can ask sellers to make repairs as a condition of sale.
Negotiating success depends largely on market conditions. In a hot seller's market where homes receive multiple offers, sellers have less incentive to negotiate. In a buyer's market with slow sales, you have stronger bargaining position.
But here's the thing: even in a seller's market, legitimate safety issues or major system failures give you negotiating leverage. No seller wants their deal to fall through, and most will address serious problems to keep the sale moving forward.
At AmeriSave, we work with buyers to ensure they have financing ready quickly, which itself provides negotiating leverage. Sellers prefer buyers who can close fast with confidence.
Some problems are deal-breakers. Save yourself heartache and money by recognizing these red flags early.
Mold is a health hazard that costs thousands to properly remediate. According to the EPA, mold grows anywhere moisture and organic material exist—which describes most homes with water intrusion problems. Visible mold, musty odors, or water stains indicate moisture issues. Professional mold remediation costs $500-$6,000 depending on extent, per HomeAdvisor, but severe contamination can reach $30,000. Unless you're getting a substantial price reduction and the seller handles remediation before closing, pass on homes with mold problems.
Water damage leads to rotting wood, structural deterioration, and mold growth. Foundation issues are even worse—repairs cost $10,000-$50,000+ depending on severity. Warning signs include cracks in foundation walls where horizontal cracks are especially concerning, doors and windows that stick or won't close properly, sloping or uneven floors, cracks in drywall especially around door frames, gaps between walls and ceiling or floor, and water pooling around the foundation. Major foundation problems should make you walk away unless you're getting the house at a steep discount and have cash reserves for extensive repairs.
Termites, carpenter ants, rodents, and other pests cause structural damage and health issues. Pest inspections cost $75-$150 and are money well spent. Active termite infestations require treatment and repair of any damage they've caused. According to the National Pest Management Association, termites cause approximately $5 billion in property damage annually in the United States. Treatment costs $1,200-$2,500 for an average home, plus repair costs for damaged wood. Walk away from properties with active, untreated infestations unless the seller handles complete remediation and repairs first.
A home showing obvious disrepair in multiple areas—peeling paint, broken fixtures, worn flooring, overgrown yard, missing shingles—likely has more serious hidden problems. Neglectful owners defer expensive maintenance, meaning major systems may be failing. This pattern signals that everything needs attention soon. While the list price might seem attractive, total renovation costs will eliminate any savings.
Walking into an open house that smells like someone dumped an entire bottle of air freshener or lit 20 candles? That's suspicious. Sellers use powerful scents to mask unpleasant odors from mold, pet urine, cigarette smoke, or sewer problems. Natural home scents like coffee brewing or baking cookies create welcoming atmosphere. Overwhelming chemical fragrances suggest they're hiding something.
Beyond major systems, specific features deserve detailed attention.
Windows affect energy efficiency, security, comfort, and home value. High-quality windows are expensive to replace at $300-$1,000+ per window installed depending on size and type. Assess pane count including single, double, or triple-pane construction, seal integrity by looking for condensation between panes, frame material and condition since wood rots, vinyl cracks, and aluminum is outdated, operation including whether they open and close smoothly and stay open, locks and security features, and age because windows older than 20 years likely need replacement. Sticky windows are usually minor issues like paint or hardware problems. Drafty windows with broken seals need replacing soon, which factors into your purchase decision and negotiating position.
I mentioned foundation issues as red flags, but even without obvious problems, you should verify structural soundness. Your home inspector checks foundation walls, floor systems, load-bearing walls, and overall structural condition. Pay attention to their findings here. Structural repairs are expensive and often uncover additional hidden issues once work begins. Some foundation cracks are normal from settling and appear as hairline cracks. Others indicate serious problems including horizontal cracks, stair-step cracks in brick, and wide vertical cracks. An independent structural engineer can provide detailed assessment if your inspector raises concerns.
Most people spend the most money on a house. You shouldn't rush through it because of how you feel or what you see on Pinterest.
Do you remember the buyer from the beginning of this story? She was disappointed when they found the problems with the foundation, but she was glad they did it before she made an offer. Her loan officer found her a different Victorian two weeks later. It was in better shape, and she loved it just as much. She closed last month, and our team got the story back with pictures of her newly decorated living room. That's the right thing to happen.
Don't rush through this process. Make a list of everything I've said here in a systematic way. If you can, visit the homes more than once. Ask questions. Take someone with you who can stay calm when you're upset. Most importantly, have a qualified professional do a full inspection of the home before you buy it.
We've given you some things to think about when buying a house, but the choice is yours. As you start looking for a house, keep these things in mind and think about what's most important to you. Find out what areas are most important to you. If you need to make certain repairs or updates right away or within the first few years, make sure you can afford them in addition to your mortgage payment.
Get your mortgage preapproval done before you start looking at houses so you can make an offer right away when you find the right one. We help buyers get preapproved quickly at AmeriSave by using a simple online process that makes buying a home easier. Our loan officers are here to help you with any questions you have and walk you through the process.
Today, start your mortgage application with AmeriSave, and we'll help you find the best way to pay for your new home. When you're competing with other buyers, having preapproval shows sellers that you're serious, which can make all the difference.
You're about to make a great investment in your future. Make sure you do it right.
Location is the most important thing that affects both the quality of your daily life and the value of your property over time. You can make changes to the kitchen and bathroom, but you can't move the house. Even if you don't have kids, you should look into the neighborhood's school districts because they affect resale value. You should also look at crime statistics from local police departments, how close you are to essential services and your workplace, FEMA flood zone maps, and plans for future development in the area. To get a good sense of the traffic, noise levels, and character of the neighborhood, drive through it at different times of the day and week. If you can, talk to people who might be your neighbors. The National Association of REALTORS® says that homes in good school districts and desirable areas sell 15–20% faster than similar homes in less desirable areas. You will have to live with your choice of where to live for years, so make sure you choose wisely. It will affect both your happiness and your financial success.
The purchase price is only a small part of the total cost of owning a home, so you should plan for big costs beyond that. You should expect to pay closing costs of 2–5% of the purchase price, which is usually $6,000–$20,000 on a $400,000 home. You should also expect to pay moving costs of $1,000–$5,000 depending on how far you are moving and how much stuff you have, and immediate home needs like furniture, window treatments, and lawn equipment, which usually cost $3,000–$10,000. Monthly costs include property taxes, which can range from $100 to $1,000 or more depending on where the home is located; homeowners insurance, which can range from $100 to $300 or more depending on the home's value and location; HOA fees, which can range from $200 to $600 per month according to Community Associations Institute 2025 data; utilities, which can range from $200 to $500 per month; and maintenance reserves, which are 1–2% of the home's value each year, or $4,000 to $8,000 per year for a $400,000 home. Also, a lot of homes need repairs or updates soon after you buy them. Even homes that are well-maintained often need small changes to fit your tastes. Set aside three to six months' worth of housing costs in case you need to make a major repair, like fixing a broken HVAC system or a damaged roof. The total costs for the first year, not including the purchase price, usually range from $15,000 to $40,000, depending on the condition of the home and whether major systems need to be updated. If you plan carefully, you won't have to worry about money.
This decision depends entirely on your financial capacity, renovation skills, risk tolerance, and timeline. If you have extra cash on hand beyond your down payment to pay for repairs, construction, or renovation management experience, can handle long timelines because big renovations take months and always take longer than planned, and have a realistic idea of how much the project will really cost, fixer-uppers can be a great deal. HomeAdvisor says that major home renovations usually cost 20% to 40% more than what was first planned because of problems that come up when the walls are opened. A kitchen renovation that costs $30,000 could end up costing $42,000, for example. Living in a construction zone is also stressful. There is dust everywhere, contractors show up at 7 AM, and the kitchen doesn't work for weeks. But if you're handy, patient, and have enough money, renovation projects can add a lot of value to your home. Make sure that the purchase price, renovation costs, and your time and stress add up to less than the home's value after repairs, ideally by at least 15–20%, to make the project worth it. People who are buying a home for the first time should stay away from fixer-uppers unless they know how to build things. Instead, look for homes that only need cosmetic changes, like new paint, flooring, and fixtures, instead of major system replacements or structural repairs. Lenders may also be less likely to give mortgages for homes that need a lot of work. This could mean that you need to get renovation loans with different terms and higher costs.
Bring a long list of questions about the home's history, its mechanical systems, and practical issues. Ask about the age of the property and how long the owners have lived there. If there are a lot of owners in a short amount of time, that's a red flag. Also ask about all the renovation or repair dates and scope, including the kitchen, bathrooms, roof, HVAC, and windows, as well as the property's tax history and recent assessments. You can also ask for copies of bills to see how much utilities cost in different seasons, HOA fees if applicable, and any special assessments that are still pending. You should also ask about the average maintenance costs the owner has experienced, any problems with neighbors or the neighborhood, why the sellers are moving (because this can reveal problems), what's included in the sale (appliances, fixtures, and window treatments), and the history of flood or water damage. For mechanical systems, ask about the age and maintenance schedule of the HVAC system, the age and capacity of the water heater, the age of the roof and any repairs that have been made, the plumbing material (copper, PEX, or galvanized) and any problems, the electrical service amperage (200 amps is ideal), the well and septic system (if there is one) including its age, maintenance, and last inspection, and any ongoing maintenance contracts that will be transferred. Also, test your own cell phone reception to see how good it is, ask about the speeds and options for internet service providers, the schedule for trash and recycling pickup, who is responsible for removing snow (you or the HOA), and how long it usually takes for sellers to move out. Write down all the answers and check important claims, like a recent roof replacement, with permits or receipts. If sellers can't or won't answer simple questions about major systems, it could mean that they don't know how their property is doing or that they are trying to hide something. Both of these things are bad.
Yes, without a doubt. No matter how perfect a house looks, you have to have a professional home inspection. The American Society of Home Inspectors says that inspectors find major problems in about 77% of the homes they look at. Many of these problems are not visible to buyers who are not trained. Home inspectors are trained experts who look at hundreds of homes every year and can spot small signs of big problems that most people miss. The inspection looks at the foundation and structure, the roof's condition and how long it will last, all of the mechanical systems (HVAC, electrical, and plumbing), any water damage or moisture problems, the adequacy of the insulation and ventilation, the safety of the chimney and fireplace, the grading and drainage, the presence of dangerous materials like asbestos and lead paint, and whether or not the building meets all of the codes. New buildings also need to be checked because builders make mistakes and sometimes skip steps. Before closing, inspectors found new homes with broken HVAC systems, missing insulation, drainage problems, and electrical code violations. The cost of a home inspection is between $300 and $500, which could be the best money you'll spend on the whole deal. If the inspection shows problems, you can ask for repairs, ask for a lower price to cover the cost of repairs, or walk away from the deal completely if the problems are too bad. Most purchase contracts have inspection contingencies that protect buyers' right to back out of the deal if the inspection reveals something wrong. Not getting an inspection to save a few hundred dollars is a bad idea. You could be spending tens of thousands of dollars on repairs that you didn't know about, and you could be buying a disaster.
Energy efficiency has a big impact on both monthly costs and how comfortable a home is. This will become even more important in 2025 when utility rates go up. The Department of Energy says that homes that are very energy-efficient cost 30–50% less to heat and cool than homes that are not very energy-efficient. For most households, this means saving $1,200–$2,400 a year. That's $36,000 to $72,000 in savings over a 30-year mortgage. Ask your inspector to check the insulation levels in attics, walls, and crawl spaces. Make sure the R-values are high enough for your climate zone, the windows are in good condition and not too old (modern double- or triple-pane low-E windows work much better than old single-pane windows), the HVAC system is efficient (modern systems have SEER ratings of 16+ compared to older systems' 10-12 ratings), the air sealing quality is good (to get rid of drafts that waste energy), the appliances are efficient (look for Energy Star ratings), and there are renewable energy systems like solar panels. Programmable thermostats and LED lights throughout the house are examples of smart home features that can help you save money. In addition to saving money each month, energy-efficient homes are more comfortable because they don't have cold spots in the winter, the temperature doesn't change as much, there are fewer drafts, and they control humidity better. These things have a big impact on quality of life. Also, energy efficiency becomes more important for resale value as buyers become more aware of the environment and how much things cost. Some buyers only look for homes that have been certified by Energy Star or that have high utility efficiency. If you're thinking about buying an old, inefficient home, include the cost of repairs in your offer. Adding insulation costs between $1,500 and $4,000, upgrading windows costs between $5,000 and $15,000 for the whole house, and installing efficient HVAC costs between $5,000 and $10,000. However, these improvements will pay off over time by lowering utility bills and making the house more comfortable.
Prequalification and preapproval are two very different levels of mortgage readiness. In 2025's competitive market, preapproval is much more useful. Prequalification is an informal estimate based on the financial information you give to a lender without having to prove it. There is no documentation needed, no credit check done, no real commitment from the lender, and it only takes a few minutes. Prequalification gives you a rough idea of how much you can borrow, but sellers don't care about it because it's not verified. Preapproval, on the other hand, is a thorough check where lenders go over your pay stubs, W-2s, tax returns, and bank statements to make sure your financial information is correct. They also pull credit reports and check scores carefully, figure out your exact debt-to-income ratio, and make sure the down payment funds are available and where they came from. The lender sends a formal preapproval letter that says how much money they will lend you. This letter is usually good for 60 to 90 days. The National Association of REALTORS® says that sellers really like offers from buyers who are preapproved because it shows that the buyer is serious and can close the deal. When there are a lot of offers, preapproval is often what decides which one is accepted. Preapproval also helps you find a home because it tells you exactly how much you can afford, which sets realistic expectations and keeps you from wasting time looking at homes you can't afford. Before you start looking for a home, we at AmeriSave suggest getting preapproved. Our easy-to-use digital process makes preapproval quick and easy. This gives you an edge over other buyers because you know exactly how much you can afford and can show sellers that you're a serious buyer who is ready to close quickly.
No, location should be the least important thing to change because you can't change it later. The old saying "buy the worst house in the best neighborhood" is still true. Over time, you can change almost everything about a physical house, like updating the bathrooms, adding features, and renovating the kitchen. You can't move that house to a better neighborhood, add a highly-rated school district, shorten the commute, or change what's around it. When making decisions about where to live, think about the long term. For example, an extra 30 minutes each way adds up to 5 hours a week or 260 hours a year sitting in traffic, which is about 32 extra workdays. If you have or plan to have children, think about the quality of the school district. Good schools help even child-free owners sell faster. Also, think about the neighborhood's trajectory over the 5–10 years you'll likely own the home, how close it is to family, friends, and your social network, how easy it is to get to the amenities you use regularly, like gyms, restaurants, parks, and shopping, how safe it is, and how crime rates are currently and in the future. Zillow's research from 2025 says that location makes up about 50–70% of a home's value, while the physical structure only makes up 30–50%. A not-so-great house in a great area usually goes up in value faster than a great house in a bad area. There are also practical limits to renovations; for example, you can't easily add bedrooms or square footage to small lots, and major expansions cost $100 to $200 per square foot. The smaller house in the great neighborhood might stay that way. Instead of moving into a home that is ready to move into in a less desirable area, think about a home that needs cosmetic updates in your preferred location. The location is permanent, but the paint and floors are not.
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