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Determine if the House is Worth the Money

Before you hand over your money, determine if the price is worth it.

Have a comparative market analysis done. Ask your realtor to provide you with a CMA. This is a comparison of homes in the same area that sold in the past 6 months. The house you want should compare favorably in the price. You should also look at how quickly homes are selling in the neighborhood.

Evaluate the house you want and research the local housing market. Browse the internet and local newspapers ads and real estate publications. Visit open houses, talk to neighbors and keep your eyes open. The best neighborhoods have good schools, close to public transportation, convenient to stores, parks, post office and doctor's offices. They should have low crime, and not near plains trains or loud neighbors.

Look past small cosmetic repairs like new carpet or fresh paint. They could be hiding things like peeling walls or cracked flooring. Look past the nice decorating because they won't be there when you go to move in. Focus on well constructed walls, floors and ceilings. Make sure the roof and basement doesn't leak, no signs of termites or other vermin, no signs of mold, rot or water damage.

Ask yourself how many bedrooms and bathrooms you need for the next few years. Do you need or can you pay for a pool or an extra office. A well designed renovated kitchen or basement or extra rooms are usually worth pay more for. But only pay more for extras such as fancy times if you want them to improve the quality of your life. Extras that may have cost the owners 20k are not likely to add 20k in value to the home when you decide to sell.

It is always wise to make your offer conditional upon a home inspection. A reputable home inspection company will provide you with a report that identifies existing and potential problems, suggestions on who to fix them and an estimate of cost to fix the repairs. It's also a good idea to have the home's market value professionally appraised. Your lender might require a home appraisal in any case before giving you financing.

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