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House or Neighborhood? How to Make the Choice

March 26, 2014

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House hunting has been so exhausting, but I think we may be finished. We’re currently in contract on a little house that we love. The biggest hurdle for us was deciding between our dream house, or our dream neighborhood. We could really only afford one or the other, and it was a tough choice. In the end, we chose location over square footage, which means that my family of 3 will be squeezing into an 800 sq ft cottage, but we’ll enjoy a safe, walkable neighborhood with excellent schools that is close to work. Although we could have afforded a home three times this size in a different part of town, we were willing to sacrifice square footage

If you’re facing this same dilemma, here are some tips to keep in mind.

1. Do your research. Look up school ratings (I use GreatSchools.org to get my school data), crime statistics, and tax information for the neighborhoods you’re considering. This could expand your options.

2. Decide on your limits. What do you absolutely need in a house? We like to entertain, so we prefer most of the square footage to be devoted to living and dining areas. Can your kids share a room, or do they each need their separate spaces? Do you need two full baths, or could you get by with one full bath and a powder room? Getting these specifics nailed down will help you filter your searches better.

3. Create a realistic budget. What can you afford? Your lender should be able to estimate what your monthly payment would be at different price points in different areas. Find out your limit and stay below it.

4. Consider handyman specials. Once you know your budget, don’t rule out fixer-uppers that fall way below it. If you find a run down home in a great area, a 203(k) loan can help you renovate it.

5. Play the waiting game. This time of year usually brings a big influx of homes on the market. If you don’t see the perfect home today, wait! You can set up alerts on Realtor.com and Century21.com to email you if a new house comes on the market in a certain neighborhood or school district. Make sure your realtor knows the areas you’re interested in, too, and they’ll keep an eye out for new listings.

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