Growing your family or enhancing your lifestyle – whatever may be the reason behind moving from a small house to a big one- the decision remains crucial. Investing in a property, small or big, regardless of the size, the buying process remains the same.
Buying Process in Hampton Park for Upsizing
Deciding to buy a property, budgeting, finding the suitable property, right location, choosing a lender and getting pre-approved for a mortgage, finding a good real estate agent in Hampton Park, Pakenham, and nearby suburbs, starting the home searching process, making an offer, getting a home inspection and home appraisal done, purchasing homeowner’s insurance.
The process of buying a home remains the same whether it is for upsizing or for downsizing the home. The only difference lies in budgeting and the size of the home. In downsizing, people prefer a small home to a large one, whereas in upsizing, the size increases. The people look for a large, open space.
Is it Worth Upsizing the House in Hampton Park?
Upsizing a house means making a shift from a house built on a smaller area of land to a house built on a larger area.
For instance, if you move from a house with two bedrooms to a house with three bedrooms, that will be termed as upsizing the house.
Why Do People Upsize?
Now coming back to the query- Definitely upsizing is worth it if you have decided to bring in your parents to live along with you, or you have extended your family, or if you need a spacious home, more luxurious, and a royal lifestyle. Other than these:
- You have grown-up children and they need their own space
- More space for hobbies, projects, business
- Entertainment area needed for guests and relatives
- Rent out spare rooms for additional income
- Raising your bar in the society
- Likes to live in open space and also
- Loves enjoying home maintenance
Who Should Not Consider Upsizing?
Upsizing is definitely not fine for homeowners who do not enjoy activities like home maintenance. Because after all, you will be moving from a small space to a larger one. The area will magnify and taking care of the two-bedroom set will comparatively be easier than cleaning and taking care of the three-bedroom set. Larger homes require more effort in their upkeep because such homes are more likely to have outdoor grounds, rooms, and seasonal upkeep of mechanical systems. Efforts are not only required in terms of cleaning the space with cloth, soap, and water but also the maintenance can get costly and time-consuming.
How to Upsize Your Home?
Upsizing the home can be rocket science, especially for those who will be engaging in the process for the very first time. The process may even turn out to be daunting and troublesome. To make the process easier and less cumbersome, it is suggested to hire a real estate agent serving in Hampton Park, and nearby suburbs. The real estate agents are experienced and licensed professionals who stay updated with the local market information. They can help people looking to upsize their homes in no time. They keep the track of the properties sold, to be bought, and those listed. So, with the wide range of data, information, and industry-wide network, it gets easier for them to find a suitable property that too within the budget – the biggest benefit – is a stress-free home buying experience.
Here are some of the steps that you must consider while buying a home as an upsizer.
Set Your Goals
Thinking critically about your goals is crucial. You must know the purpose of moving into a bigger space because the larger the area, the more the maintenance.
Understand If Your Desires Are in Sync with the Budget
Determine if the bigger is truly better than the smaller. At this time, you must take into consideration of the major factor that is the budget.
Consider the Resale Value
Think of the future and then take the final decision. What property, which location, and where are you looking forward to making a major shift? It is good to consider the resale value of the house for a secure future.
Things to Consider Before the Final Move
The budget – What can you afford?
Moving into a larger home means buying something more expensive. You may be are able to use the equity you have grown in your current property to buy the next home.
Pro-Tip- Keep in mind that only a certain proportion of your equity can be used while you decide to upsize the home.
Types of Costs Involved
This may turn out to be an expensive affair once you factor in the costs involved. A number of expenses add to the process as we all proceed like – stamp duty, agent fees, legal and conveyancing fees, building and pest inspection reports, refinancing, and removalists to help you move your possessions. Hidden costs must be discussed with the real estate agent that you hire in Hampton Park or anywhere in the vicinity of the area.
Sell the Current House or Use it As an Investment
When upsizing the house, this factor must also be taken into consideration while budgeting. Whether you want to sell the current house or you want to use it as an investment property. The decision is all yours. If you look forward to keeping the current property as an investment, then you need to make sure that you are financially comfortable paying two mortgages at a time.
Timing Your Decision
Deciding to sell your home first and then buy or buy your home and then sell. This is important because you may not be able to buy a new property if you do not sell your current home first. Also, at the same time, what if you do sell and are still unable to upsize the house? If you do not plan about such vital aspects, you may end up with a financial burden and even may lose a roof over your head. So, you would need a backup plan and also choose to upsize at the right time.
When Should You Move to a Bigger Home?
This is not any financial advice but general information on when should you make such a big move.
Now that you have made a decision, you are determined that you need to upsize. The next step is to figure out if this is the right time to make a move or not. While taking this move, keep the following things in mind:
For all the good reasons – Low-interest rates often spark a spate of borrowing. When the interest rates are low, you get to pay less for your loan over its lifetime and you enjoy lower monthly payments too. This attracts especially when you are thinking to upgrade your home.
Buying a home would probably be the single largest purchase you will ever make. If you have to pay less every month, and that too for the lifetime of your loan, you will have more discretionary income to spend elsewhere.
Look into the Finances
Before you start looking at homes in the market, it is better to peep into the finances. Spend some time going over your monthly, day-to-day finances. You may want to purchase a home now but that time may not be right. So, financially the idea may not turn out to be that good. When buying a home, you will have to make sure that such a big purchase is not threatening your financial security.
At the same time, you will also have to show lenders that you have enough financial resources to easily pay off the monthly mortgage payments. It means you need to bring home about three times the amount of your mortgage every month.
Many may ignore this aspect but this is one of the most important things to consider. If you are buying somewhere in Hampton Park, and your real estate agent hails from the same area or nearby suburbs, market conditions will be taken care of. But if you are going solo, you must consider this factor. Here why:
- If the market is at a low, which means that prices are sharply declining, then it is called the buyer’s market.
In the buyers ‘market, you will have more power to negotiate. Also, you will more likely be able to purchase more houses for your money.
If you can manage to club a buyer’s market with low-interest rates, you will find that you also have to give lower monthly mortgage payments.
Equity is the difference between the present value of your home and how much you owe on it. For instance, if your home’s worth is $600,000. You owe $220,000, your equity is $380,000.
In general terms, the longer you own your current home, the more equity you build up in it.
Once your equity reaches the 20% mark, it becomes the right time to trade up to a roomier abode.
You can also use the equity to make the down payment of your upsizing home. This way half of your financial burden reduces.
To Buy or To Sell First?
This is the one question that confuses the upsizers. Let us see the pros and cons of both buying and selling the home first.
Pros of Selling First
- You know how much you have in your hand. You will know how much to spend and the expectations to keep.
- You get to maintain your financial security. You will eliminate the possibility of overextending yourself. This often happens because the homeowners tend to overestimate the amount they will receive from the sale of their current house.
Cons of Selling First
- The timing might not be right or it might be off. You may have to find other living arrangements before you make a final purchase.
- You might have to find short-term renting somewhere at your friend’s place or a family member’s.
Pros of Buying First
- You will not have to make any other living arrangements.
- Because you are not in a hurry to sell first so you will not miss out if the perfect home becomes available.
Cons of Buying First
- More pressure because you will have to pay two mortgages at a time.
- You might settle for less, like agree to take a lower sale price. It can leave you emotionally and financially vulnerable.
- It might even take you longer to sell your home than you expected. So, you will be left carrying two mortgages for a longer time period.
If you are someone actively looking forward to buying a bigger home, it is advised to take suggestions and consult a real estate agent serving in Hampton Park, or Pakenham.
Tips For Moving into a Bigger Home
Now that you have decided to finally make a big move. You are well aware of the right time to shift, you have decided the purpose, budget, and whether you have to sell or buy first. After making all the decisions, the next step is to prepare yourself for finally shifting to a bigger space.
Here are the tips that you must follow:
Do Not Shift Until the Deal is Closed
It feels like being on top of the world to get into a dream home. But you must hold onto the excitement until the deal is finally closed. Anything can happen like closing dates may get delayed or canceled due to appraisal or inspection issues. If anything of such sort happens, you would not want to be stuck. Do not rush for anything. Stay calm until everything is checked and tested.
It is good to be well prepared and organized beforehand. You can stay organized by keeping essential items together. Keep things on the basis of priority. The items you need the most must be kept on the top for the usage and those to be used the least must be kept in the last. Storing items in order ensures that they end up in the correct rooms.
Make a List of Things you Will Need
This is the best way to know what you need and which items need to be thrown away. The list will prevent you from making any extra purchases. Often during a move, people think that they need more than they actually do.
Also, you stay organized while you are at the store. You will have a lot going in your mind and might end up impulse buying. It not only increases the expense but will also stuff the house forcefully.
Once the deal is finalized, the house will all be yours. So, take your time to buy, move and shift the place. Rushing may lead to mistakes and regrets. Do not give yourself a chance to go through any mental ordeal. Let the feeling of excitement stay while you make decisions wisely.
Do Not Overspend
Even though you are moving into a new place, it is important to take care of your future finances. You do not have to overspend to make your home look appealing. You do not have to buy all the things at once. When you plan and envision each room, you are less likely to overspend on furniture and decorations.
Cleaning is Must but Make a Schedule
More space means more cleanliness is required. It may sound silly to schedule cleaning, but it will help in maintaining the home which may not be in the condition you desire. Life is busy and hectic, so scheduling and planning things out can help keep you on track. It is better to clean a small mess every day than to attend to a bigger mess on a single day.
Segregate Space as Per Priority
You might have chosen to shift to a large space because you wanted extra space for your kids, or maybe an entertainment area for yourself, or a crafts room. While it is a lot of fun to think of it, you must spend more time on what you actually wanted out of the space. So, first concentrate on the rooms where which you may need the most then, the living area, bedrooms, washrooms and so on. Take in on a priority basis. The rooms that are to be used less can be taken care of in the last.
There is no rule to upsizing a house no compulsion on who can actually do it. Many a time, even retired and old people also prefer upsizing instead of downsizing. So, there is no particular formula for who can choose to upsize their house. But whatever you may choose to do with your valuable asset, it is suggested to have a real estate agent by your side. For instance, the real estate agent in Hampton Park would know more about the local area than an agent serving in any other suburb.