Brian and Bo pick up where they left off last week by detailing financial factors to consider when participating in the housing market. The guys even discuss some strategies and tools to utilize when reviewing non-mortgage, housing related expenses.
First, when allocating money for housing, Brian likes to see total housing costs no more than 25% of your gross income (mortgage, taxes, insurance). Traditionally, with lending practices, 28% is the more accepted number. However, to maintain a good lifestyle and truly enjoy the benefits of home ownership, Brian prefers 25% of gross income over the popular 28% benchmark.
Outside of the budget you make to pay your ownership costs, it is important to consider all the expenses that come with owning a home. We found a great article from Paula Pant, More Than a Mortgage; The Cost of Owning a Home, that details the areas that you can expect to spend money on and the likely life expectancy of housing materials.
If you know where you would like to move to or from, you can often find every transaction on your home or in your neighborhood using Zillow. It is a great tool to use to keep an eye on the housing trends in your marketplace. This allows you to compare your housing value, real estate taxes as well as recent sales and purchases in your current or desired neighborhood. A great resource to make sure you are getting the best deal on your utilities is WhiteFence.com.
A newer trend that has surfaced is to try to lower your real estate taxes by reviewing your assessor’s report and bringing their attention to any inaccuracies. To make sure that you are taking full advantage of the resources that Brian and Bo discussed on the show, go review Amanda Alix’ article, Are You Paying too Much in Property Taxes? Here’s How to Tell.