Buying a Home

Whether you are a first time buyer, ‘moving on up’, or looking for a second home or vacation home,  home purchase is a major life event and it is critical that you obtain advice and guidance to ensure a successful outcome.

Financial Considerations:

The buying decision is usually made following an assessment of purchasing power and detailed consideration of the use to which the home is going to be put.

For example, buyers seeking a permanent residence will set usually their budget in line with their ability to meet ongoing house and mortgage related expenses. VA Loans are an excellent source of 100% financing for U.S veterans.

Purchasers of a second home or vacation home also need to consider carefully their ongoing out-of-pocket expenses. Unless the purchaser has the desire and ability to cover these expenses from his or her own funds, then the feasibility of the purchase should be determined by the ability to meet or off-set these expenses from the rental income that is realistically achievable.

For a vacation home buyer, the number of weeks of rental may be a major consideration. Of course, it is not just a matter of how many weeks you can achieve; the dollar amount received for each rental is equally important and should not be overlooked.

The number of weeks rental one can obtain each year, in partnership with a good management company is quite variable.  Clearly, it will vary depending upon fluctuations in the tourism market as well as the level of owner involvement in generating bookings. In practice, the most successful short term rental vacation home owners are those maximizing personal bookings.

The process of buying a home or investment property generally begins with determining ones buying power; that is, financial reserves plus borrowing capacity. Unless the preference is to pay cash, mortgages can be arranged for qualified individuals.

For foreign buyers who are financing the purchase in the U.S., a deposit of at least 30% of the purchase price is now normally required. In some cases larger deposits may be necessary. The larger the deposit, the less documentation the lender requires from a borrower in order to give mortgage approval. We can help you understand your options and refer you to lenders best qualified to help you.

Florida Ideal Realty can arrange for a mortgage loan officer to contact you and provide additional information. This would simply be a courtesy and would not commit you in any way.

Deciding What To Buy:

Once these initial hurdles have been cleared, a key decision for most purchasers is whether to buy a new or resale home.

New homes are very tempting. A buyer has control over every aspect including floor plan, lot selection, pool design, furnishings, options and upgrades. However, this comes at a price which is significantly more than the equivalent resale home.

New homes generally come complete with floor coverings (normally wall to wall carpets and vinyl or ceramic tile); kitchen/bathroom cabinets and counter tops; lights; cooker; dishwasher and waste disposal unit. The lot will be fully landscaped. Window coverings, refrigerator, washer and dryer would usually cost extra.

Many builders also offer a pool/investor’s packages.  Prices and contents vary from builder to builder, yet might include the following items:

            *   Washer, dryer and refrigerator
            *   Window blinds
            *   Owners’ closet
            *   Swimming pool, pump, heater, patio/deck and screened enclosure
            *   Upgraded lawns and irrigation system.

Sometimes the builder’s price includes a furniture package. Alternatively, there are specialist furniture companies who can provide complete packages ranging from around $12,000 to well over $20,000, depending on the size of the home.

The standard price for a new home includes a regular lot. Should a buyer be interested in choosing a home to be constructed on a premium lot there nearly always will be an additional charge. Oversized lots; lots with no rear neighbors; lots backing onto conservation areas, golf courses or bodies of water are all regarded as premium lots for which the builder may charge from several thousand dollars upward to several hundred thousand dollars depending on the quality of the development.  

New homes are definitely worth considering for buyers who either can afford to reduce their ongoing expenses by putting down a substantial deposit to ensure a smaller mortgage or, in the case of a vacation/second home purchase,  have sufficient resources to meet ongoing expenses without relying totally on rental income.

In practice, the typical buyer of a vacation/second home will have more limited financial resources and will be fully or partially dependent upon rental income to cover costs. The logical choice then is a resale vacation home.

There is a very good supply of recently constructed resale homes in attractive subdivisions at prices to suit all budgets. Generally, a home's price will reflect it's condition. Homes priced below regular market value could require some refurbishment. Homes priced at normal market value should not require anything more substantial than cosmetic enhancements to reflect the new owners tastes.

Another option in the current market climate are the short-sale and foreclosure properties. This will be a relatively short-lived phoneme, and should be shown definite consideration as potential savings could be substancial.

When buying resale for short term rental, it is advisable to purchase a home that is already fully furnished and set up as a vacation home.

Finding The Right Home:

Once it has been established how much can be comfortably invested, the next step is to identify the properties that best fit the buyer’s requirements. We have many resources to assist in this search.

Florida Ideal Realty is a member of  the Board of Realtors®  and the Mid-Florida Multiple Listing Service. We can, therefore, offer the maximum choice to our customers, following careful assessment of needs.

As members of the Mid-Florida Multiple Listing Serivce, a Florida Ideal REALTOR® can show customers any home (new or resale) available for sale in Osceola, Lake, Polk, and Orange counties.

The key benefits to a buyer are:

Thoroughness:  We can show every available home For Sale in Central Florida that meet  buyers requirements, not just those that Florida Ideal Realty has listed for sale. This means a purchase can be made with full confidence that the chosen home is best suited for individual requirements, because a buyer will have had the  opportunity to see them all.

Conveniencee. Instead of having to call many different offices to arrange viewings, we can handle all of this for you. We will call each real estate company and, as necessary, each management company, to make appointments to view selected homes.

Instead of having to spend days making appointments and viewing homes with multiple agents over multiple days, we can arrange for the homes to be seen over the course of several hours, thereby  freeing-up valuable holiday time. What’s more, this is absolutely free of charge.

There are times when properties of interest are available yet not actively advertised in the market, and it takes some investigation to find.  Florida Ideal REALTORS® are exceptionally well-placed to do this.

A customer’s role is to make the final selection on the right property. This is when excitement and emotion can run high. Florida Ideal REALTORS® assist in the selection process by providing objective information about each property. In this way all the information needed to make an informed decision is available, thereby enabling one to make a purchase that fulfills wants and needs, as well as having maximum resale value when the time comes to sell.

Contractual & Legal Aspects:

There are myriad negotiating factors, including, but not limited to price, financing terms, date of possession, and often the inclusion or exclusion of repairs and furnishings or equipment. In Florida, this is  done by means of a written contract. 

The purchase contract will also provide a period of time for completion of appropriate inspections and investigations of the property; also to confirm acceptable financing before a buyer is bound to complete the purchase. Florida Ideal REALTORS® prepare the contract and advise as requested as to which investigations and inspections are recommended or required.

With negotiated contract in hand, various tasks need to be completed. These may include inspections for termites, dry rot, faulty structure, roof condition, septic tank and well tests, just to name a few.

Assistance can be provided in finding qualified, responsible professionals to handle these investigations and provide written reports.  In fact, all the necessary arrangements for inspections and repairs can be arranged for a buyer eliminating any involvement by the customer is so desired.

Similarly, we can obtain quotations and make arrangements  for home insurance policies.

Closing The Transaction:

In Florida, the transaction is normally handled by a Title Company (sometimes called the Closing Company). The Title Company will handle the title transfer and associated tasks, e.g. the legal searches of the public record to ensure the buyer takes clear title; drawing up and registering the new deed; payment of duties; arranging title insurance, disbursement of funds and so forth.

If a transaction is unusually complex, either party might opt to involve a real estate attorney. However, this is relatively unusual.

Legal fees in the US are termed closing costs.  These costs include mortgage arrangement fees; appraisal fee; title insurance; stamp duty and intangible taxes; survey fee; pest inspection; prepayment of homeowners’ insurance, mortgage interest and property taxes.

Closing costs are much less if a buyer is paying cash since the costs associated with the mortgage will not apply.

Florida Ideal REALTORS® do not charge buyers for their services. REALTORS® are usually paid through the sales commission paid by the seller or new home builder when a transaction closes.

REALTORS® have a variety of expenses and financial obligations. Thus, it will be to everyone’s benefit if one REALTOR® is selected for representation. The chosen agent will respect this loyalty and respond with sincere and professional commitment to the buyer.

Florida Ideal Realty extends it’s hand, wishing you ‘Good Luck’ and ‘Happy House Hunting.’

We look forward to meeting you!