Buying Real Estate in Boulder County as an Escalator to Wealth

While a few renters manage to squirrel away money, the average American discovers that home ownership is a faster escalator to wealth. According to billionaire Warren Buffett, there are several reasons why home ownership is still the financially wise move to make. A recent article by cnbc.com points out that real estate is a valuable asset, especially for families and individuals buying real estate in Boulder County. Buying a home in Boulder makes a lot of sense because of the strong job market and attractive lifestyle that draws high-end buyers. An “oracle of real estate,” Buffett explains several reasons why home ownership is an escalator to wealth for most Americans.

Enjoying 30 years to pay off a loan

The 30-year fixed rate mortgage is an excellent and inexpensive way to borrow money for a home. At this time, interest rates are still low. Buffett tells reporters he took out a 30-year loan for a California home in 1971. He bought the home for about $150,000 and listed it recently for about $11 million. Buffett points out that if people buy a home at a higher interest rate, they can always refinance when rates dip down. Every time you make a mortgage payment, you essentially contribute to a forced savings account in the form of home equity.

Expressing yourself with personal decor

Another benefit of buying real estate in Boulder County include the personal freedom that come with owning your own place. Buffett says he does not plan to sell his Omaha, Nebraska home that he bought in 1958. After raising a family and creating memories, few people want to depart from their family home. When you rent a home in Boulder County, your landlord or property manager often controls everything from paint colors and landscaping to flooring and appliance selections. Renting often leads to anxiety and uncertainty about lease renewal and rent increases.

At Laura Guerra Real Estate, we help people with the rent versus buy decision in Boulder, Lafayette, Longmont, Louisville and other great communities. To find out more reasons why buying a home benefits you financially, please contact us.

Ask These 3 Questions Before Putting an Offer in on Your Dream Home in Boulder

You’ve found it–your family’s perfect home. It meets all your specifications and then some. Or does it? Before you make an offer on a house, take your emotions out of the decision for a moment. Ask yourself and your real estate agent these three important questions to make sure this is the right house for you and that you’re getting the best deal possible.

 

1. What needs to be fixed?

Conduct your own informal home inspection before you make an offer. Some problems could cost you a lot of money in the future. Does the roof need any work? Are carpets and hardwood floors in good shape? How about large trees–are they healthy? Does the house still have its original water heater? Has the house been inspected for mold recently? If you’re not comfortable checking for these things yourself, have a knowledgeable friend or family member come with you on a walk-through. Always have a professional home inspection done before the sale is finalized.

 

2. What is the neighborhood like?

If you see a potential neighbor outside your dream home, don’t hesitate to ask if they can answer a few questions. Ask if they like living in the neighborhood and if it’s a quiet street. Also, ask if there’s anything you should know before making an offer. If you’re upbeat and friendly, people are often willing to disclose a wealth of information. Other information can be found on the Internet, such as school report cards and crime rate. Try to visit the house at different times of day, as well as weekends and weekdays. Weekday noise and traffic may be much different than it is on Sunday, the most common day for open houses.

 

3. Is there any wiggle room on price?

There are many factors to consider when deciding how much money to offer. For instance, how long has the house been on the market? You may be able to make an offer below the asking price if it’s been on the market more than 90 days. Also, look at the comps–similar houses in the neighborhood that have sold. Does the house you’re interested in fit within the prices paid? If it’s more expensive, consider starting with a lower offer. However, make sure you are open to negotiating with the sellers.

 

Buying a home is the biggest investment most people will make. It is important to be certain before putting in an offer so you don’t regret it later. If these questions have been answered satisfactorily, congratulations! You’re ready to put an offer in on your dream home.

What Is Buyer’s Remorse, and the Questions You Ask to Avoid It (Part 2)

In Part I we looked at the basic, before-you-begin questions. You do keep asking some of those questions as you view possible homes because ideas do change, but if you begin with a solid foundation, you maximize getting the right result. As you view homes you may move something from the ‘would like to have’ list to the ‘must have’ list. It happens. Where buyers can go wrong is when they only have a vague idea about what they want, believing they will get everything clear as they look. Then as they do look, something goes right off their radar, and they miss something that is critical.

So let’s keep asking those questions.

How Much Can I Really Afford?

Many buyers think they should find a home, then speak with a mortgage lender. Some sellers do not want to spend time staging their home, and letting someone view it only to learn they can’t buy it anyway. Sellers have a right to tell their Realtor “Pre-approved buyers only.” Buying the wrong home is a disaster; not being able to see what might be the ideal home is very sad. So get pre-approved.

Your lender will approve you for a mortgage loan because that is what you can afford. They will also take into account mortgage insurance costs, property taxes, and your homeowner insurance premium. If the monthly cost of those takes you to the maximum monthly outgoings you can afford, and you then buy a home that also has a high homeowner association fee, or if you have to spend a lot of money on repairs in two or three years, the overall cost may give you buyer’s remorse. Avoid the remorse by knowing what you can afford, and get pre-approved.

What About Home Inspections?

Another great question. The contract to purchase gives you certain rights, and gives the seller certain responsibilities. You agree to buy a home that is functional and safe. The seller agrees to sell it to you. Home inspections tell you more than an untrained eye can see. A home inspector, for example, checks the roof, the electrics, the plumbing, the heating and cooling systems, etc. to make sure they are functional. Choose a home inspector who is properly qualified and experienced. You may also choose to have additional inspections done, such as for wood destroying organisms.

If you attend the inspection, you can ask questions, and learn more about the property than you may learn otherwise.

What about the HOA or Condo Covenants?

If you buy a home in a subdivision or condo that is governed by CCIOA (Colorado Common Interest Ownership Act) then there will be rules and regulations you must follow. You may not be able to run a business from your home, you may be limited as to what colors you can paint the outside, you may not be able to put up a child’s play set that is visible from the road, just to take three common examples. Before you choose a home, make sure any covenants will allow you to live as you choose.

You may, of course, not want a next door neighbor who runs a pre-K or who breeds large dogs, and you may want to live where everyone is required to maintain their yards. So one of the most important questions to ask is “May I see the covenants, please?”

Final Note

Today we looked at the less obvious questions buyers should ask. The whole idea is to give you the best foundation possible, so you make the best decisions possible. Avoiding buyer remorse is easy when you work with the right Realtor, and you ask the right questions.

What Is Buyer’s Remorse, and the Questions You Ask to Avoid It (Part 1)

Good Question

 Of all the questions to ask when buying a home this is the most powerful. Asking this question will give you the best foundation possible to do everything right. You want to buy the right home on the most agreeable terms, and you want to live in it happily. That sounds obvious. But do you know what the second biggest reason is for a home going on the market?

It is because the current owner bought the wrong home to start with.

Think about that. They spent all that time looking for the ideal home, they got approved for a loan, they wrote the offer, held their breath, got it accepted, had the home inspected, closed on it. Then, after less time than they thought, they decided it wasn’t right. If only they had asked the right questions sooner.

I encourage my buyers to ask all the right questions, so they can do everything knowledgeably and confidently. And so they do not suffer buyer’s remorse. There are different ways to avoid buyer’s remorse, so in this short series of articles we will look at each of them. 

My buyers trust me to help them. Here is how I start.

Plan Ahead 

Buying a home properly (a primary or vacation residence, or an investment property) takes forward planning. Inexperienced buyers sometimes don’t plan as well as they should. So the first questions to ask yourself are:

  • What is our preferred location? How important is school district, commute time, convenience to local shopping, entertainment, hiking and biking trails? What about noise levels during the day and at night? How important is it for us to have neighbors like us (young families, empty nesters, Millenials, etc.)
  • What kind of property should we buy? Single family home, townhome, or condo?
  • What age of property will work for us? Some properties will need more maintenance and repair work than others.
  • What size will be right for us now, and a few years into the future? Growing family? Parents moving in? home-based business?
  • What floorplan will be right? Layout, number of bedrooms and bathrooms, home office space, games room, walkout basement, etc?
  • What really is our price range? Your deposit, mortgage costs, taxes and insurance, maintenance costs, homeowner or condo association fees, commuting costs, etc, should all go into your calculations.

Follow Your Plan

Make lists that make your planning clear. If you are buying with someone else, agree your lists with each other. Check your lists, and ask yourselves these questions:

  • What are our ‘must haves’
  • What are our ‘must not haves.’
  • What are our ‘like to haves’ and
  • What are our ‘would prefer not to haves.’

If, say, you must be away from a noisy main road, or if you must have a certain number of bedrooms, then these are ‘must haves,’ not ‘like to haves’ or ‘think about it later issues.’ If being in this school district or out of a flood zone are on the essential list, then keep them essential.

Why Do This?

Because good planning is the secret to long-term happiness when it comes to home-buying. If you buy a new jacket, and you don’t like it, you take it back. If you buy a new home, and you don’t like it, you live a less happy life, and you spend a lot of money selling it and buying another one.

My Goal as Your Realtor

My goal is not to sell you a home; my goal is to help you make good decisions. My buyers do not suffer for buyer remorse, because I help them to ask all the right questions. My goal is for you to be so happy with your purchase, you want to work with me for years to come. In Part II of this series we will explore more questions you should ask to make sure you choose the right home.