There may come a time when you find yourself interested in buying a home out of state. Maybe you’re doing so because you’re moving for a job. Perhaps you’re looking for nothing more than a fresh start in a different part of the country. Or maybe you plan on using the property as a vacation getaway.
Regardless of why you’re buying a home out of state, keep this in mind: the process is different than if you were buying in your state of residence.
While there’s no right or wrong approach to this process, there are steps you can follow (and tips you can lean on) to stay the course and improve the likelihood of making a purchase that checks all the boxes.
1. Do Your Research
You may be familiar with your local real estate market, but this differs from state to state, city to city, and community to community.
For example, buying a home in New York City or Los Angeles is much more expensive than Cleveland or Kansas City (when comparing apples to apples).
A good level of research will help you better understand the market, which can help you answer questions such as:
- What can I get for my budget?
- Is this really the right move?
- Which area of the state makes the most sense?
Along with the above, your research should extend into real estate laws and regulations for the state in which you’re buying the property. Just the same as the market itself, laws vary from state to state.
2. Hire an Experienced Real Estate Agent
While it’s okay to take on some of the research and buying process yourself - such as searching online for available homes - it won’t be long before you need more targeted assistance. And that’s where an experienced and knowledgeable real estate agent comes into play.
You can rely on your agent to:
- Find homes that suit your criteria
- Show you homes, all while outlining the pros and cons
- Connect you with other professionals, such as a mortgage broker and home inspector
- Pinpoint concerns and help you overcome them
- Protect your legal rights, such as those pertaining to the disclosure
Above all else, your agent is available to answer your questions and address your concerns. Without a professional on your side, it’s much more likely that you’ll make a mistake you regret.
3. Don’t Buy Sight Unseen
In today’s day and age of advanced technology and an expansive online world, it’s easier than ever to buy a home sight unseen.
This sounds like an efficient way to purchase a home, but you’re taking a big risk. Even if the property is in excellent condition, you never really know what you’re getting until you step inside and see it for yourself.
Time may be tight and you may have to travel a great distance to visit potential properties, but it’s worth it in the end. You’re spending a lot of money on a home, so you must take every step possible to get what you want.
Buying sight unseen, even if you have the help of a real estate agent, is never recommended.
4. Get All the Help You Can
There’s no shortage of help to be had when searching for and buying a home.
A real estate agent is a good place to start, but here are some other places to turn for assistance:
- Mortgage broker or loan officer: These financial professionals can help you secure the best mortgage for your situation. When you neglect to get help in this area, you risk taking on a loan with a higher than expected interest rate. As a result, it could cost you thousands of dollars over the term of your mortgage.
- Home inspector: Even if a home looks perfect to you, there are likely to be things that are damaged, installed wrong, or need to be replaced. A home inspector can pinpoint all these things, giving you the opportunity to renegotiate with the seller.
- Appraiser: Do you have questions about whether a home is truly worth what the seller is asking? An appraiser can help you answer these questions, as they know the local market like the back of their hand.
Along with the above, don’t hesitate to rely on friends and family for help. Even if it’s someone to bounce ideas off of, it’s nice to have a sounding board and a different point of view.
5. Prepare for Closing
Once you find a home and reach an agreement with the seller, the clock will begin to tick. Typically, you’ll close on your home within 30 to 90 days.
It’s easy to let the closing process overwhelm you, as you’ll find yourself buried in a mound of paperwork (most of which you won’t understand).
Prepare accordingly by reading through the documents, asking questions, and having a professional (such as a real estate attorney) review the paperwork from start to finish.
Tip: work with a title company that is familiar with the laws in your current state, as well as the one you’re moving to. This makes it much easier on you, as they understand what you’re up against on both fronts.
If you have any questions in advance of your closing, address them immediately. Don’t wait until the last minute, as you could forget something or feel pressured into signing documents you don’t understand or agree with.
Final Thoughts on Buying Real Estate Out of State
Buying a home out of state sounds like a big undertaking, and it is. Fortunately, when you have a process in place and an idea of what you want to accomplish, it’s easier to get on track and stay on track from start to finish.
Don’t limit yourself to buying a home in your current state of residence. If there’s a reason to buy out of state, learn more about local laws and the real estate market. This will help you make an informed and confident buying decision.