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A checklist for buying a new home

Local Commentary

Posted: April 24, 2008 7:17 p.m.
Updated: June 24, 2008 5:02 a.m.
 
Home ownership and housing are essential to the strength and vitality of a region. It is the cornerstone of family security and stability; it strengthens our communities; it is crucial to the national and regional economy; and it enhances overall quality of life.

According to the National Association of Home Builders, the construction of 1,000 single-family homes generates 2,448 jobs in construction and construction-related industries, approximately $79.4 million in wages, and more than $42.5 million in federal, state and local tax revenues and fees. The construction of 1,000 multifamily homes generates 1,030 jobs in construction and related industries, approximately $33.5 million in wages, and more than $17.8 million in federal, state and local tax revenues and fees.

April is New Homes Month. This year, as more and more families take advantage of the current market to consider purchasing a new home, it's important to follow some simple guidelines that could make a substantial difference during the buying process:

* Establish a budget. What size loan do you qualify for and how will it affect your financial situation?
Getting pre-approved and understanding your limits can be a life-saver. While current interest rates may allow you to borrow more than you expected, it's important that you are realistic about how much you want (and are able) to spend. Make sure to include any potential upgrades and additional features in the budget. And set aside enough money to pay for application fees, lawyers' fees, additional taxes, and so on.

* Make a list. Writing down some specifics can make the buying process a little less overwhelming. What do you need, what you want, and what would you like to have (though it may not be a necessity). A list acts as a proverbial road map, guiding you away from properties that may be in the wrong area or that don't work for your family. A list also helps family members resolve any potential issues about needs and space.

* Check out the location. Developments may have restrictions on the location of individual homes in order to ensure an attractive streetscape. Take this into consideration and review lots carefully with regard to sun patterns, traffic, noise and privacy. 

* Do your homework. When buying a new home, you also buy the builder's expertise and reputation. Take time to research builders in your area to better understand the homes they build and the communities in which they are involved. This is also a good time to speak with previous customers to gauge their satisfaction and the service the builder provided. 

* Go through builders' sales packages to find out what is included in the price and get any necessary clarifications; research standard home features versus available upgrades; pay attention to brand information and manufacturers' warranties along the way.

* No two companies are alike - make sure you know the difference.
 
* Compare, compare, compare. When making a final decision, carefully consider price, value and individual attributes. Make sure you carefully consider and evaluate the quality of the construction - it can make all the difference over time.

The bottom line is that now is a good time to buy a new home. Beyond lower mortgage interest rates, there are bigger and better housing options on the market, with features and amenities that accommodate busy lifestyles. New homes are also more energy efficient - about twice as energy efficient as new homes were just 20 years ago.

New homes are competitively priced, which makes them a sound financial investment. Most important, however, is the fact that your new home is an investment in your future - a place for you and your family to live that will provide shelter for many years.

Holly Schroeder is CEO of the Building Industry Association - Los Angeles/Ventura Chapter, with offices in Valencia. She may be reached at hschroeder@bialav.org. Her column reflects her own views, not necessarily those of The Signal.

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