4 Tips for Buying a Home as a Business Owner
Buying a house is a challenging process – no matter who you are! But if you’re a business owner, it has an entirely different set of challenges that require even more careful attention to detail. Do you know where to start?
4 Tips to Help You Buy Your Ideal House
The decision to buy a house – whether it’s your first house or your “next” house – is always an important one. It involves a number of factors including finances, emotions, and even relationships (depending on where you choose to live). As a business owner, each of these issues is made even more complicated by the unique position you’re in.
Whether it’s timing, financials, logistics, or responsibility, you have a lot to consider as you buy a house. Here are some tips to help you streamline the process:
Understand What it Takes
Underwriting requirements can be strict for self-employed individuals. Make sure you’re aware of what you need in order to buy a house.
For example, most lenders are going to require at least two years of tax returns. So if you’ve only been in business for a year, you might need to wait a little longer. (Generally speaking, the longer you’ve been in business, the higher your chances are of getting approved for a good mortgage.)
Evaluate and Project Finances
A lender might tell you that you can afford a $350,000 loan with a $2,000 monthly payment. But that’s just a formula they use based on a few metrics. Only you know what you’re truly comfortable paying. Evaluate your finances and zero in on your number.
Secondly, try your best to project your finances into the future. Financial predictions are a fool’s game, but you must remember that your mortgage sticks around for 15 to 30 years. If you don’t think you’ll be able to pay the same amount in five years, don’t buy the house.
Hire the Right Real Estate Agent
Choosing the right real estate agent is always going to be important. It’s even more critical when you have limited time to be involved in the process. As a busy business owner, you need an agent who is experienced, who understands your time constraints, and who is willing to work with you to proactively find the best possible home.
A good real estate agent needs a well-defined home buying process. McGraw Realtors are a great example. They’ve developed a simplified real estate process that consists of: (1) schedule a consultation, (2) tour the right homes, (3) choose your perfect home, and (4) have confidence. Notice how clean and concise that is? You want an agent who has this level of clarity, conviction, and direction.
Look for the Right Type of Property
Be cognizant of the types of properties that you’re looking at. The separation between work and life is no longer as clear as it once was. And if you fast forward three to five years into the future, it’ll probably be non-existent. So choose a house that allows you to live productively as both a homeowner and business owner.
“As a small business owner, you may need to meet with your clients and partners from time to time,” industry insider Joyce Lee writes. “With this, it’s best to find a place that provides quick access to local employment hubs. Choose the location of your house wisely and make sure it’s strategically located in an area with convenient access to businesses, clients, and other important establishments that you often need to visit.”
Furthermore, think about whether you want to move your office into your house. And if so, what sort of space do you require? Think big picture, but don’t be afraid to get down in the weeds and figure out the details as well.
Are You Ready to Buy a House?
If, after reading this article, you find yourself overwhelmed, consider whether you should take a step back and hit the pause button. There’s no rush to purchase a house. Take your time, prepare for what lies ahead, and move with purpose and intentionality.
If you’re too busy to dedicate the time required to buy a home, put it on the back burner and return to it in three to six months. If you’re uncertain about your company’s future, maybe you need to wait until a few issues get fleshed out. And that’s okay!
At the end of the day, it’s all about ensuring you’re in a place to make a smart decision. And if you’re confident that you are, then begin moving in that direction.