Is the idea of purchasing a home crossing your mind? In that case, it would be smart to make up a list of what you need and want in a house. That way, you can organize your ideas and thoughts in needs and wants.
What you need in a house
For instance, in the need list, the most important thing would be starting with economics. What is your budget? Do you need a place where you can reduce your cost of living?
The size of the house, you will put how many bedrooms you are looking for. Another need could be a place for you to crash and enjoy visiting an area for a couple of months out of the year. Also, the need for a place in the warmth.
Maybe it’s a place near family members or a place close to medical services. Maybe you want to tighten up your budget. So you say I want a place where I can live where my heating and cooling expenses do not surpass more than $80 a month.
All these are examples of what you could be listing out in regard to needs.
What you want in a house
On the other hand, you can place on your Want List. I want to be able to have a pool or a jacuzzi.
Or I want to be able to invite friends, so I need that guest bedroom.It could be that you want to have a home theater, so you want the room to set that up.
You probably get an idea if you’re able to find the type of house. The style of the house could be colonial. Maybe it’s a modern house. Maybe you even want the typical Mexican style with regional materials.
Therefore, having a list of needs and wants is a great way to start organizing your ideas of what you want to purchase and where you want to buy. And then establishing a budget.
It depends on the taste, but this is where you can start to dream a little bit and see if it’s possible. That maybe catches your fancy about the type of house that would be your ideal.
Share With your Agent What you Need and Want in a House
You need to share this with your agent to see if there are any options out there or something very similar that catches your eye that could be a good possibility for you.
What you can afford
Now one of the questions is how to know what you can afford. Well, probably an easy way to do this is to look at four scenarios.
The first scenario would be if you already have a rental property that you’re using. And you think this is the right moment. The market has peaked. You’ve done a pretty good job of appreciation. And it is a good time to cash out.Thus, when you’re studying to relocate the capital or the investment, you maybe want to keep the same amount.
Let’s say you have a $300,000 property. You sell it, and then you’re able to re-invest those 300,000. Now you’ve learned a lot over the years. You’ve seen what kind of expenses and what the highest one could be. Probably property taxes. Maybe it’s the maintenance of the property.
Maybe you invested it in a beat-up type of property, and it just constantly needs repairs. So, learn from that when you re-invest the $300,000. Thus, when you re-invest, one of the first things you look for is another place that’s up and coming.
You can invest at a low point being 300,000, and just a lot of potential for appreciation. Study the different types of markets you’re looking for. For example, where there’s new job growth, there is a lot of future potential.
A small little town that has just been announced that a new company is coming into town. It’s gonna create 2000 jobs, and that has a lot of appreciation potential.
Suppose you want to invest in a tourist region where tourism has been growing and is expected to grow for the next 5 to 10 years. This would be a good place where you can park your 300,000 and begin renting to the tourists and get good returns.
First scenario is just cash in, cash out. You’re cashing in from the sale of your current rental property, and you’re just transferring that to another up-and-coming region for another property.
Now the second scenario would be if you want to downsize. Maybe you have that rental property, and you want to downsize into another property and take the difference.
Let’s use the same example, 300,000. You decided to invest 150,000 of that in an adventure project or stocks and the other 150,000 to invest in a smaller size property in a new up-and-coming real estate market.
So in that scenario, you’re just diversifying your money. You’re basically moving into different types of assets.
Part of the money you’re reinvesting into a different real estate market. And you’re looking to invest the other part in different investment assets.
An example of the third scenario is when you have a couple of properties, and one of them has already peaked. You want to cash out of it and move that money into a different region. You probably want to increase the amount of capital that you have planned to invest in this channel.
Suppose you have some money in a stock that has been low performing in the last three years. So you take part of that money out of this real estate property that’s already peaked. And you combine that and invest in a larger property.
The fourth scenario would be if you’re using this property not so much just as rental revenue, but it is where you live. Maybe you’re retired, and you don’t want to live in the colder northern zones.
You want to go to warmer weather in Mexico, and there you go through a little bit of the same process. You ask yourself if you need and want in a house five bedrooms when it’s only your wife and you. So you can downsize.
So that is still part of how to determine your budget when purchasing a second house or downsizing. Take your time to know the process of determining how much money you want to invest in property.
Lifestyle and Future Plans
Lifestyle and future plans help you know waht you need and want in a house. Well, lifestyle is pretty self-explanatory. Know what your current hobbies or things on your bucket list are: playing golf, horseback riding, biking, swimming, taking walks along the beach, and hiking. And just find a new property that has those amenities nearby or within the same community.
Review what your current hobbies are and what you enjoy doing, and then leave a couple of spaces open for some new hobbies that you’ve never tried before. That will help you to find places that are in agreement with what you need and want in a house.
I would start thinking if I want to be close to my family. Second would be the kind of weather, the hobbies, and likes. The weather is always one of the first or second. The majority of people are looking for warmer weather. You can always do a lot more.
Of course, some people enjoy things like skiing or snowmobiling, winter activities, or mountain winter activities. So that would be high on your list of the region for you to retire or to move to.
However, the majority of people tend to go for warmer weather, lakeside living, or beachside living. So those would be some things to consider looking for the ideal location to move to.
But also it could be a quiet little village, a colonial city, the mountainside, a lakeside, or a tourist hotspot.
Visit the Neighborhood to Find your Ideal Location
Once you’ve narrowed it down to three or four locations, then go spend time in the neighborhood, walk around and then make sure that the neighborhood around you is what you’re looking for.
Just going out there walking to different restaurants or eateries or that type of activities. And then make sure that the neighborhood has those types of amenities to offer.
Retired people are looking at more and more neighborhoods in Mexico with those considerations. There’re 7 or 10 restaurants that are located within big neighborhoods.
Thus, they can just easily arrive at one or two blocks full of restaurants and ice cream parlors, and wineries. People that live in the neighborhood can either ride, walk or take their bikes. That’s become more and more popular, and you can see a lot of neighborhoods designed in that fashion.