Savvy home buyers who are preparing to make a real estate purchase should do their research and understand that they need to save money for not only the down payment, but the closing costs as well. The closing costs can account for as much as three to five percent of the sales price in some cases, so this can be a rather sizable amount of money. Some home buyers however, may not realize that the amount of closing costs can vary considerably based on the home that is purchased. With a closer look at why this is, home buyers can make a more educated decision when selecting a home to purchase.
Prepaid Taxes And Insurance
One of the most significant closing costs relates to prepaid taxes and insurance, and both of these expenses are directly tied to the location and value of the property. Consider that the property tax rate can vary based on the city, county, and state. Real estate insurance can also vary based on the type of construction of the home, if the home is located in a flood plain, and other factors. These are only a few examples of how the location and property type can impact these fees, and home buyers should consider the costs assoicated with the tax rates and insurance when selecting a property to purchase.
Third Party Reports
There are several third party reports that are commonly paid for at closing, and these include an appraisal, a survey, a pest inspection and a property inspection. The third party reports may vary in cost based on the size of the home, the amount of land that is being purchased, and even the condition of the property. Those who want to keep their closing costs lower may consider learning more about how these fees are calculated up-front before finalizing their plans to buy a specific home.
Title Insurance Fees
Title insurance fees are another typically sizable expense for home buyers, and this insurance offers protection to the lender if the title is not clean. Title insurance can increase based on the size of the property as well as different factors that are revealed with a title search. This information can be difficult to learn with an initial home search, but home buyers should be aware that title defects can increase closing costs.
The location, size, age and construction of a property all impact the closing costs. Those who are shopping for real estate may be inclined to make a decision that keeps closing costs down, and they can reach out to their knowledgeable real estate professional for more assistance with their particular situation.
Each real estate market is unique in various ways, and your local real estate agent can help you to become more familiar with the trends in your community. For example, in some areas, it may be common for a seller to pay for at least a portion of the buyer’s closing costs, but this may not be common practice in other areas. While each market may be unique, there are some common trends that you can expect to be rather widespread across many communities throughout the rest of the year.
Last week’s economic news included an encouraging report from the National Association of Home Builders, whose housing market index held steady with a reading of 60 in July. This was the 13th consecutive month for readings over 50, which indicate that more builders are confident about housing markets than those who are not. July’s reading was noteworthy as it was the highest since November 2005 prior to the recession.
Home builder confidence remained steady at the highest reading in almost ten years according to the National Association of Home Builders (NAHB) Wells Fargo Housing Market Index for July. The latest reading of 60 for the index was identical to expectations and June’s reading, which was revised to 60 from an initial reading of 59. The NAHB Wells Fargo Housing Market Index is based on readings of zero to 100 with readings over 50 indicating that a majority of home builders surveyed are confident about housing market conditions. July’s reading was the 13th consecutive month of readings above 50. 
Homeowners who are thinking about listing their home for sale in the coming weeks or months may be focused on improving their home to help it sell more quickly, but there also may be a focus on adding value to the home in the process. While each home is unique, there are a few projects that most homeowners would benefit from. In fact, these are a few simple and easy projects that can typicaly be completed over the course of a weekend; that can add value and desirability to the home.
It is common for those who are interested in buying real estate in the near future to tune into news stories about the real estate market, and many may have heard that there is speculation about a real estate bubble that may pop soon. While this gloomy outlook on the real estate market can strike fear in some hearts and may deter a purchase until a later date, the fact is that summer 2015 is an excellent time to purchase property. In fact, there are three good reasons why potential buyers may want to start moving forward with their buying plans soon.