What Boston home buyers should know before they buy

The Ultimate Home Buying

Guide for 2021

INTRODUCTION

You’ve recently experienced a pandemic, a recession, a historic election, and a serious change in how we normally interact with each other in 2020. What a rollercoaster year! Many of your friends and family have moved to new places so they can adjust to “the new normal” and this year you are interested in making a move of your own as well. Nuhom, pronounced /new-home/ is here to help!

 

Whether it's your first home purchase or not, Nuhom takes the scary out of the home buying process and we are here to put you at ease through each step! We offer a no pressure and no obligation approach in working with us. We also value our home buyers greatly-- these days with listings at your fingertips, Nuhom believes that most home buyers do indeed find their home using their own search efforts. For this effort, we give every home buyer back 50% of our buyer agent commission as savings. We not only believe you deserve this, but that you’ve also earned it. Until date, this has resulted in an average of $7,500 for each of our home buyers. Many of them have put the savings towards home renovation and home furnishings! We offer all of our services and on-demand guidance on our site at www.nuhom.co.

 

Where should you start and what’s new in how you may buy a home this year? Well, below we break down what you need to know and the various pros and cons about buying a home now! Also, we address what to think about at each stage of the buying process. The Boston area is a great place to live, hopefully this helps you in 2021!

 

TABLE OF CONTENTS

 

What’s different about buying a home now vs. before 2021 and what happened in 2020?

  1. Why Boston: Job and population growth have been positive

  2. Interest Rates: They are at historical lows

  3. Lenders and banks: Post pandemic more financial scrutiny on your loan application

  4. Inventory & Prices: More options and pricing stability to come

  5. Tour technology: 3D virtual tours mean easier research from the comfort of your home

  6. Urban vs. Suburban: Depends on what you like, buy where you fit in best


 

What are the steps to home buying?

  1. Actually write down your needs and wants

  2. If you’re getting a mortgage, get a pre-approval

  3. Tour homes, online and offline

  4. Milestone 1: Strategize and make an offer, small deposit made

  5. Lock in your lender of choice (skip if you are paying with cash)

  6. Further due diligence and what to expect in a home inspection

  7. Milestone 2: Sign a purchase & sales agreement, big deposit made

  8. Lender underwriting and mortgage approval (skip if you are paying with cash)

  9. Milestone 3: Your closing and official purchase

  10. Move and get settled

What’s different about buying a home now vs. before 2021 and what happened in 2020?

 

Why Boston: Job and population growth have been positive:

 

Living in the Boston area provides several options for you! Jobs, history, sports teams, academia, nearby hiking and skiing, and an array of neighborhoods to explore are just some of them. Boston’s real estate market has appreciated greatly in the last decade and it also managed to weather the 2008 financial crisis quite well. Boston’s resilience and growth have been born out of its diverse and growing job market and its increase in population. Both of these are directly linked with strong real estate markets.

Boston's Job Growth, 2001 to 2017:

Boston's Job Growth By Sector, 2001 to 2017:

Nuhom - Boston's job growth by sector 2017

Source: http://www.bostonplans.org/getattachment/33993523-dce0-4cfd-903c-5eb8744733e8

 

The job growth diagrams above were some of the latest published by Boston Plans


To further demonstrate job growth through 2019, Glassdoor put out some great research about Boston’s base pay increases and job openings:

Growth in Job Openings and Pay Across 10 Major U.S. Metros:

Source: https://www.glassdoor.com/research/job-market-report-september-2019/#

 

As you can see below, the growth in job openings is not just in one sector, but it is across several sectors!

Let's take a closer look growth in job openings:

figure4-localmetrotrends.png

Source: https://www.glassdoor.com/research/job-market-report-september-2019/#

 

While the above paints a rosy picture about employment, we know that the pandemic did have an impact on Boston and its job market. In fact, at some points of 2020, it was one of the hardest-hit cities and unemployment was above 10% for the state of Massachusetts. Since then unemployment has come down and is recovering in line with many other states. 

 

Greater Boston’s Population Growth:

 

Active job growth leads to a growth in population. The diverse array of sectors that Boston offers jobs in has attracted a diverse population as well. Over the last 30 years, immigrants and people of color have most increased the population in the Boston area.

Greater Boston's Population Growth Is Driven By Immigrants Of Color. Net Population Change Greater Boston 1990-2017:

Source: https://www.wbur.org/news/2019/05/08/boston-area-demographics-report-takeaways

 

If we look at the overall population growth more recently from 2010 through 2018, the Greater Boston area ranks as the 10th most populous region in the US with nearly 4.9M people.

Top 10 Most Populous Metropolitan Areas 2018:

Source: https://boston.curbed.com/2019/4/23/18511826/boston-region-population-2019

 

Whether you’re looking to live in the city or in other parts of Greater Boston we believe that the City of Boston as a central hub plays a prominent role in how real estate appreciates and how the population grows around it. Here is an interesting 2030 projection put out by the City of Boston which was published in March of 2017 which will continue to talk about job and population growth and how the City plans on managing the influx. 


 

Interest Rates: They are at historical lows

 

Interest is the fee you pay to borrow money from a bank in the form of a home mortgage. The lower interest rates are, the lower fee you pay to borrow that money. The historic news is that rates have lowered immensely! The last time the Fed made a similar decision to lower rates like this was in 2012 due to the aftermath of the 2008 financial crisis. In 2020, the Federal Reserve decided to lower the rate as much as they have due to the pandemic and in hopes to spur investing activity.

Average 30 Year Mortgage Rate:

Nuhom - Average 30 year mortgage rate

Source: https://themortgagereports.com/63050/lowest-mortgage-rates-in-50-years-coronavirus

 

Before that for at least 50 years, interest rates were much higher. Well ‘much higher’ is an understatement. Imagine a mortgage with a 16% interest rate? With a home mortgage, a higher interest rate increases the cost of homeownership. Many baby boomers who purchased in the ’80s experienced this. A home purchase of $500,000 with a 20% down payment then would cost $5,662 a month vs. now $1,863 a month in mortgage payments. That’s quite the difference, $3,799 a month in cash saved just in mortgage payments due to the interest rates then and now. While that’s a real example, keep in mind that homes were much cheaper back then!

 

The additional good news is the Fed has also decided to keep rates low for the foreseeable future into 2022 and perhaps even 2023. This is most dependent on how the economy and the nation’s unemployment rate recovers.

 

Taking advantage of the low rates while you can is highly recommended. If you already own a home, taking advantage of a refinance or home equity line of credit would be important to consider if you haven’t already.

 

The low-interest rates have made homeownership overall more accessible to those who have previously wondered if continuing to rent is better or if buying a home is the way to go. It’s actually lowered the monthly cost of homeownership.
 

Lenders and banks: Post pandemic more financial scrutiny on your loan application

The pandemic’s havoc in 2020 resulted in high job loss in the country. Since then banks and lenders who may give you a home mortgage have tightened up their regulations and requirements. As opposed to before the pandemic, they may now ask for additional employment verification or ask for verification at multiple milestones during the mortgage application process. They may also have a higher credit score or down payment requirement. This is not to say you will be unable to get a mortgage especially with the low rates offered, but that each borrower is scrutinized a bit more than pre-pandemic. After all, a lender or bank is investing alongside you in the purchase of your home and your ability to pay back the mortgage is essential to them.

 

Nuhom has developed a list of preferred lenders that clients have had great success with. Nuhom vetted, they offer competitive interest rates, low closing costs, timely closings, and helpful advice and guidance to home buyers along the way. If you’d like, Nuhom would be happy to introduce you to them to best fit your needs.
 

Inventory & Prices: More options and pricing stability to come

 

Like economics has taught us, there is supply and demand with everything. In the case of home buying, supply is the number of homes or inventory for sale on the market and demand is the willingness or amount of interest of a buyer, perhaps such as yourself in purchasing that inventory. When supply is high, and demand is low, the price may come down, and when supply is low, and demand is high, prices may go up.

 

In 2020, with particular types of homes, we saw this play out one way or another. The below depicts how much condominiums, multifamily, and single family homes were sought after while also comparing sales price changes. The following are some meaningful graphs that show quite the story. Given what’s been happening in the market, the graphs will prove what is more favorable or unfavorable for buyers to consider.

 

If you don’t like reading graphs try to stay with us as we describe them to you and explain why they are important for you to know!

 

A quick legend to keep in mind: 

 

Shown as yellow bars for each quarter, across each property type, we compare 2019 vs. 2020 percentage change (increase or decrease) in median sales price-- the larger the bar, the larger the % increase in price. 

 

Layered on top of them, are two lines, a grey, and a blue line. 

 

The grey line depicts that for the supply of homes available for sale how quickly people were willing to buy them in 2019, also known as the absorption rate. 

 

The blue line depicts that for the supply of homes available for sale how quickly people were willing to buy them in 2020, also known as the absorption rate.

 

What you should know: 

 

A higher percentage for absorption rate means it's more favorable for sellers. A lower percentage for absorption rate means it's more favorable for buyers.

Nuhom - Boston Condominium homes price change 2019 vs 2020

Activity with condominiums in Greater Boston shifted quite a bit from the beginning of the year to the end of 2020! 

 

Much of what you may have heard on the news did play out -- due to the pandemic, in April buyers wanted more space and would work more remotely than before. For this, condominiums became less sought after. As a result, you can see the blue line lowering throughout the year as condominium supply sat on the market longer, and respectively, the median price increase each quarter begins to lower or level off.

 

This is a stark difference with the grey line which represents 2019 and pre-pandemic condominium activity. Remember when the hype was living in an urban condominium where you would be a couple of minutes away from neat shops and restaurants? Zoom rooms and backyard greenery were the new hype in 2020.

 

The bottom line today is if you’re interested in buying a condominium, the market environment has become much more favorable for you now. It’s less competitive and prices aren’t increasing as quickly as before. The condo market just isn’t what it used to be.

Nuhom - Boston Multi family homes price change 2019 vs 2020

Activity with multi-family real estate in Greater Boston is similar to that of how condos performed, but a bit different. Renters occupy most multi-family properties, and due to the pandemic, many renters decided to leave and head home or elsewhere. There was 3x the number of vacancies in rental properties in Boston in 2020 vs. 2019.

 

Buyers who typically purchase multi-family homes are either investors who want to rent the entire property out to tenants or they may decide to live in one unit and rent out the others. With renters flocking, we see a very similar absorption rate decline like condominiums in 2019 to 2020. However, what’s different is that pricing increases as a percentage did remain high for multi-family in 2020. We believe if rental vacancies continue to remain high in 2021 that multi-family pricing should lower or stabilize.

 

Buyers interested in multi-family homes do have a leg up to purchase in this environment. Overall, there is less competition and if you believe eventually renters or tenants may return to the city it may be a good investment to make now.

Nuhom - Boston Single family homes price change 2019 vs 2020

The single family activity was the exact opposite of how condos performed. It is clear that people valued single family homes in a new light and were willing to pay and compete for them. Throughout 2020 as news of the pandemic grew, buyers decided they wanted more space. From urban to suburban, white picket fences with homes that offered work from home office spaces and backyards for kids and young adults to lounge in were in. Big time! 

 

Every month median sales prices and the absorption rate increased. There simply weren’t enough single family homes to go around for the buyers who wanted them. In Massachusetts prices for these homes jumped nearly 15% in 2020

 

In 2021, we believe that people will continue to desire and want single family homes. The competition for them was very high in 2020 and that will continue this year. We do expect there to be more supply for buyers to choose from though. We expect this will help stabilize prices for single family homes.

More options to choose from are coming: Favorable for buyers! 

Nuhom - Boston homes active listings in Boston 2019 vs 2020

As you have seen, the home sales market seesawed from the beginning of 2020 until the end. The part of the story that is not clearly shown by the prior three graphs is the lack of homes that went for sale. Overall, there was a 5% decrease in home sales, but this was heavily weighted with single family down a whopping 38%!

 

The lack of new listings put a lid on home sales in 2020. To make up for the decrease in home sales in 2020, we believe in 2021 even more homes will come to market and buyers will have more options to choose from with pricing increases to stabilize. 

 

Part of Nuhom’s commitment to its clients is increasing transparency in the real estate industry. One of the many ways we do this is by providing home buyers with great research. You can view much of this research under our blogs and our real estate tracker
 

Tour technology: 3D virtual tours mean easier research from the comfort of your home

 

The pandemic has forced the real estate industry to rethink how to do tours. With six feet apart rules and the fear of spreading the virus it gave way to a big increase in the use of 3D virtual tours. You may not see one available online with every home, but there are certainly plenty more virtual tours available now than pre-pandemic.


If you’ve found a home you like, a lot of simple desktop research can be completed from home before spending the time to do an in-person tour. With online 3D virtual tours, you can get a fairly realistic idea of the quality of rooms and finishes, layout, and size from the comfort and safety of your home.

3D Virtual Tours: 23 May Street, Cambridge, MA

figure12-virtualtour.png
figure13-virtualtour2.png

Click around the home, measure room sizes, check out the outdoor space, and spend as much time as you want hanging out. 8 out of 10 home buyers are taking more 3D home tours since the pandemic citing safety concerns

 

In place of the common open house concept that many are familiar with, in some homes, private tours became the preferred method to see a home in-person. This gives you more privacy and independence when touring your potential dream home. It’s a nice option when you want to avoid bumping elbows with other potential buyers, but more importantly, it gives you the peace and quiet you may want to envision yourself living there. 

 

At Nuhom, we believe in on-demand tours. If attending an open house doesn’t work for your availability, we make it easy to request a tour here.


 

Urban vs. Suburban: Depends on what you like, buy where you fit in best

 

Before 2020, the decision of where we live was very much tied to where we physically work or conduct or day-to-day activities. With the newfound ability to work remotely, many home buyers decided to move or live in areas they may have not otherwise considered before. They chose to live based on their true needs and wants while not having to heavily consider a restricting commute to the office. We think this is an interesting shift and it will have opened up the ability to create communities in new places.

 

Where you live is a personal decision. This is simply a reminder that living in the suburbs or in urban areas can offer their individual benefits.

 


 

What are the steps to home buying? 

  1. Actually write down your needs and wants

  2. If you’re getting a mortgage, get a pre-approval (skip if you are paying with cash)

  3. Tour homes, online and offline

  4. Milestone 1: Strategize and make an offer, small deposit made

  5. Lock in your lender of choice (skip if you are paying with cash)

  6. Further due diligence and what to expect in a home inspection

  7. Milestone 2: Sign a purchase & sales agreement, big deposit made

  8. Lender underwriting and mortgage approval (skip if you are paying with cash)

  9. Milestone 3: Your closing and official purchase

  10. Move and get settled

 

What to keep in mind along your journey: 

  • You can skip steps but only if you’ve already completed them or they do not apply to you

  • Steps may be repeated, sometimes multiple times

  • Take it one day at a time

  • Buyer’s fatigue is real, stay focused and stay positive! 

  • If you are buying a home with a mortgage, the process from offer acceptance to closing will be at least 30 days.


 

Step 1: Actually write down your needs and wants

 

Like most big purchases, it’s a great idea to think through what is important to you. For buying a home, you should list your needs vs. your wants. Make sure to actually write them down. For needs, think about what you absolutely cannot live without, and for your wants, think about those nice to have items. Your needs vs. wants will be different from others. Think about what’s ideal for you for the next several years, or even the next 5-10 years if possible.

 

If they are important to you, you can consider items such as:

 

  • Bedrooms and bathrooms: How many of you will live there? Do you intend on hosting people in your home? Might you rent this home out one day?

  • Location: Need a quiet street? Are you trying to be close to particular amenities? 

  • Neighborhood: Different from location, but is there a community you’d prefer to live near? 

  • Space: What are the various functions you want to optimize for?

  • Transit: Is being close to public transit important to you? 

  • Greenspace: Nature is great maybe in the form of a backyard or a nearby trail you can reach? Would you prefer a deck? Or a park?

  • Schooling: Do you have or will you have kids who may benefit from a strong school system?

  • Parking: Do you want dedicated parking? Are you ok with street parking or renting a parking space nearby?

  • Distance to work: We are zooming along these days, but do you need to head to a workplace?

  • Privacy: Is having privacy important? Do trees and nature provide this? Does living on a higher floor provide this?

  • Pets: Is being able to house pets important?

  • Light: Is having direct sunlight important? 

 

The above list can go on forever! Do your best to focus on the ones for you :) 

 

Other questions you may want to consider: 

 

  • Are you only looking for a move-in ready home? 

  • Are you open to doing any home renovations? 

  • By when do you want to own a home? 

  • Are you on a rental lease right now and does that impact your thinking?

 

If you can, try to draw a line between your true needs and wants. As you look at homes online and tour homes you’ll further hone in on what you like and don’t like, but better you’ll identify what's important to you.

 

Pro-Tip: Understand who is making the decision about needs and wants. Is it just you, you and maybe a partner, or perhaps you and some family? Make sure to stick to the needs and wants of who will be living at the home and using it day-to-day. It's tough to please everyone’s needs!

 

Pro-Tip: It’s OK to have your needs and wants change. However, understand what’s changed each time they do. Sometimes they will change based on what homes on the market offer vs. what you hoped for.

 

Pro-Tip: It’s OK to have a couple of approaches if you’re not set in one direction. Perhaps you’re open to a condo or a multi-family home in Arlington and Medford. These are two very different types of homes and in different towns, but maybe it’s on your list to explore these options. Feel free to explore and learn as you do.

 

Pro-Tip: The perfect home may not exist, if it does, it may be out of your price range. When you see a home you like, keep in mind the things you can change about it and those that you simply cannot. You can adapt a home to fit your style and needs, but you cannot pick up a home and move it.  


 

Step 2: If you’re getting a mortgage, get a pre-approval (skip if you are paying with cash)

 

We get it! You see the perfect home online and your first instinct is to run out the door and check it out. This would be the right move, but not unless you have a pre-approval in hand. Before you start touring homes, if you intend on buying your home with a loan a.k.a mortgage, it is imperative to get a pre-approval from a lender. Without one is like shooting with a blind-fold. This review and document allows you to understand what you can afford so that you can spend time wisely on homes in the right price range for you.

 

Once a loan officer understands more about your employment, existing debt and income, and credit score they can explain the available loan programs. Having a pre-approval on hand also allows you to make an offer on a home if you find something you like. It's like your ticket to play. Including a pre-approval as part of your offer is also imperative! It helps the seller assess your ability to buy the home they are selling, without one included they may not even consider your offer.

 

Nuhom’s preferred lender is on stand-by and ready to help provide a pre-approval when needed. You can request one by answering questions here. On average, they take less than 1 business day to provide you a pre-approval letter.

 

Pro-Tip: A pre-approval from a lender doesn’t mean you have to use them for your eventual financing. Once you have an accepted offer, if you choose, you will have some time to shop around for other loan options.

 

Pro-Tip: A pre-approval is not the same as a pre-qualification. A pre-qualification is simply an estimate of what you can probably afford. Unfortunately, this does not hold up against a pre-approval and it won’t give you a full sense of the loan options a lender can provide you. 

 

Pro-Tip: To give you a pre-approval, a lender will have to run your credit score. Many borrowers are concerned that this negatively impacts their credit score. Kind of ironic, right? If you’ve had your credit score run multiple times in a short period there may be a minor temporary negative change to your credit score. More often than not it does recover in a few weeks.

 

Pro-Tip: Pre-approvals are typically valid for 90-120 days from when provided.

 

Pro-Tip: An interest rate provided when you are given a pre-approval is not the final rate you may end up with, but it is likely close. So you should accept it as an estimate. You get a final rate after you have an accepted offer and you ‘lock in your rate’ with your lender. This will be dependent on what your lender (or the market) can offer at that time. In other words, if a lot of time passes between when you get a pre-approval and get an accepted offer there could be some changes to the loan specifications.


 

Step 3: Tour homes, online and offline

 

Now that you have a good idea about your needs and wants and what your budget looks like, it makes sense to invest more time in diving into home listings. You can do this a few ways-- sign up with Zillow, Realtor.com, Redfin, or Nuhom to check out listings in the Boston area. 

 

Nuhom offers home listings on its site and it also offers a neat tool where you answer some questions to help recommend the right home listings for you. You can click on Connect with Nuhom and follow the experience and Nuhom will set you up to receive curated home listing updates in your inbox.

As discussed in the first part of this guide, last year’s pandemic gave company employees Zoom, well it gave realtors and home buyers 3D virtual tours! Not with all home listings, but with many more now than before, you can view a home in 3D right online at any time. When you find a home listing you like, this is a helpful addition to what you can research from home and it should further aid your decision making. You can measure rooms, click your way to multiple floors, go to outside parts of the home, and make early assessments of the quality of the home’s finishes and amenities.

 

With so much at your fingertips, we see here that there is plenty of desktop or online research you can easily do before you spend the time to go see a home in person. Can you remember a time when google street view did not exist? With simple tools you can learn so much about if a home may or may not be a fit for you!

 

When you decide that the home is indeed a great potential fit for you, feel free to simply schedule a tour at the bottom of Nuhom’s site. We will do our best to accommodate your availability.

 

Pro-Tip: Home listings may include disclosures, make sure to read them carefully. They may indicate known aspects of the home’s condition, particular condo rules (if you’re buying a condo) such as if pets are allowed and any rental restrictions, or a seller’s specific requirements in a sale. You may identify a showstopper early on.

 

Pro-Tip: This is certainly a big decision, but try not to overwhelm yourself by looking at every home. Buyer’s fatigue is a real thing! Stay focused on homes which come close to meeting your needs and wants.

 

Pro-Tip: During in-person tours, feel free to unlock the Sherlock Holmes in you! Or lean on a home inspector or your Nuhom agent for further thoughts.

 

Pro-Tip: Walk around the neighborhood. Feel free to say hello to neighbors and get their thoughts about the neighborhood. Feel free to drive by the location at different times of the day. 

 

Pro-Tip: If allowed, take pictures or a video of everything, especially of any items of concern which may need some follow-on thinking.


 

Step 4: Milestone 1-Strategize and make an offer, small deposit made

 

Everyone is different, sometimes buyers find a home within seeing their first few homes and decide to move ahead with an offer. Sometimes it can take a lot longer. It's often a function of knowing what you want and being realistic about what the market is offering. It’s your journey! 

 

Finding a home and preparing to make an offer can be both exciting and nerve-wracking, all at the same time! Whether it’s your first purchase or not, symptoms may feel like you’re getting on a roller coaster. As long as there is a great level of excitement built into it, this feeling is OK. The truth is people across the county buy homes everyday (nearly 15,000!) and there are systems in place to offer you a smooth process.

 

We are ready when you are to proceed! You will never find Nuhom or its agents pressure you to make an offer or even push you to change terms or pricing. No obligations, contracts, or pressure here! They will provide any guidance they can gather, but the decision to move forward and when will be yours. No sales-y tactics here.

 

You can start an offer online and once you do you will be paired with a dedicated agent that has experience in your area and they will guide you the rest of the way. At the bottom of the Nuhom site, you can also request to receive a home pricing analysis to understand how to value the home you’re making an offer on. You will be asked to make a good faith deposit with your offer (which goes towards the purchase) which is only collected if your offer is accepted. Usually this is about $1,000. 

 

Your Nuhom agent will take your draft offer and further refine it given what can be gathered about the property and go over strategy, pricing, terms, and any risks with you. Nuhom makes it easy to submit an offer completely virtually. The agent will use their local expertise to get your offer accepted.
 

Pro-Tip: Remember asking price is just a number, your offer price should take into account how you and the market value the home.

 

Pro-Tip: In a seller’s market, when the seller has much of the leverage, here are tips about how to proceed

 

Pro-Tip: Buying a home, like any investment has risks. Understand the risk you are taking on. At the same time, don’t lose out on a great home because you’re trying to over-insure yourself (especially for a hot property). 

 

Pro-Tip: An offer is just an offer, there are additional steps (below) before the deal is sealed. 

 

Pro-Tip: Keep a checkbook on hand. We know, not all of you will have one. Some of you have never even used a check. This is something Nuhom will improve as we grow. 

 

Pro-Tip: Nuhom gives you back 50% of the buyer agent commission on any listed home you find and decide to purchase in working with our agents. We clearly show you this rebate for every home on our site. We give this rebate back as savings to home buyers because we believe you deserve it. With home listings at your fingertips, 7 out of 10 home buyers find the home they want to buy due to their own search efforts-- so we reward you for spending the time to search. Nuhom focuses heavily on ensuring the execution of your home purchase goes smoothly. 

 

Pro-Tip: Nuhom’s rebate to home buyers has averaged $7,500 until date. Often, this can cover all your closing costs. No other brokerage in the Boston area provides this!


 

Step 5: Lock in your lender of choice (skip if you are paying with cash)

 

Congrats on your offer being accepted! You’ve achieved a big milestone in the process! Now you’ll want to decide on the best lender for you. You can choose the lender who provided you a pre-approval or you can learn about what others can offer. It’s important to ensure the lender can meet the dates in your offer, offer you a competitive interest rate, and has good control over the full loan process. 

 

Pro-Tip: Feel free to talk with 2-3 lenders. Nuhom has a preferred list of them here.

 

Pro-Tip: Interest rates are at a historical low. This won’t last forever!  


 

Step 6: Further due diligence and what to expect in a home inspection

 

While you’re deciding on a lender you should be conducting further due diligence and assessing the home. Your Nuhom agent will also look through further documentation on the property and conduct due diligence with the town or city as well. 

 

If your offer included a home inspection, you will set up a time to meet at the home. These last about 2 hours depending on the size of the home. The inspector will test appliances, look for plumbing and electrical concerns, foundational issues, exterior deterioration, and provide you with a list of any major safety concerns. If any major issues are found your Nuhom agent can renegotiate the terms of the accepted offer. 

 

Pro Tip: While experienced in what they do, your home inspector cannot see through walls!

 

Pro Tip: Focus on safety issues when re-negotiating the offer with the seller. 

 

Pro Tip: Your Nuhom agent will check to see if there are any open permits or violations existing on the property.


 

Step 7: Milestone 2-Sign a purchase & sales agreement, big deposit made

 

The Purchase and Sales Agreement (P&S) is a legally binding document that lays out the final terms of the sale. It will be negotiated between your attorney and the seller’s attorney and will supersede the offer and incorporate any agreed changes since. This is the who/what/when/where of the sale and contains the list of names of the parties involved, a description of the home being bought, the final price of the property, important dates to secure a mortgage, and closing information.

 

Pro Tip: This may seem pretty complicated, but your Nuhom agent and the real estate attorney will guide you through this.

 

Pro Tip: You will make an additional deposit at this stage, it will go towards the purchase of the home. Usually, this is 5% of the purchase price less your initial deposit made at the offer stage. 


 

Step 8: Lender underwriting and mortgage approval (skip if you are paying with cash)

 

Congratulations on accomplishing the second big milestone: signing your P&S agreement. You will provide this document to your lender. Your lender will move forward to complete underwriting your application and request further documentation as they need it. Your lender will also have an appraiser walk through the property to ensure the price accepted is in line with the market. 

 

Pro Tip: Try to be at the ready when your lender requests further documentation. 

 

Pro Tip: Your lender will base your loan off of the purchase price or the appraisal whichever is lower. 


 

Step 9: Milestone 3-Your closing and official purchase

 

This is the final milestone! Congratulations, you are almost there. During the week of your closing your Nuhom agent, your lender, the seller’s team, and your attorney will finalize documents for signing and recording at the local registry. Your attorney will make sure the property comes with a clean title. You’ll plan to wire the remainder of the funds to your attorney and meet them to sign and review the closing documents. Meeting with your attorney will take about an hour. 

 

Pro Tip: Get excited! You did it! You’ve bought your home. You will get keys once the deed of the property is officially recorded. 

 

Pro Tip: A few days before your closing date, your lender will send you a breakdown of all of the remaining funds needed in a closing statement. You should review this and ensure it matches your understanding. 

 

Pro-Tip: With your Nuhom agent, you will do a final walkthrough of the property before closing. During this time you will ensure it is provided as expected per the terms set in the P&S. 


 

Step 10: Move and get settled

 

You’ve made it! You can move into your new home and enjoy it. Make memories you will cherish for years to come and make your home your own. 

 

Pro Tip: Depending on what utilities are used, you should set up utility accounts such as electricity, gas, and water in your name. 

 

Pro Tip: When you have time, get to know your neighbors.


 

Nuhom is here to provide you what’s needed to be successful with your home buying needs. We’ve got an expert team that supports you the full way. Everyday we continue to improve the current home buying process to make it simple, transparent, and more affordable. Today, we offer 50% back of the buyer’s agent commission and tomorrow we intend on increasing transparency in the process like never before. Connect with us today at www.nuhom.co. We can’t wait!

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

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