7 Questions to Determine if You’re Ready to Buy an Alaskan Home

The American Dream we are sold on from birth is to grow up and buy that perfect house and raise a family. To many it is a huge deal, and some consider it a sort of rite of passage into adulthood. Aspiring home buyers are finding their dreams harder to reach in an expensive real estate market. Those living in Alaska have either relocated here or have lived here their whole lives with the dream of planting their own roots. Buying a home can understandably feel like an emotional roller coaster at times. With any big purchase or decision, it’s important to sit down and calculate the cost before you jump in headfirst. How do you know if you’re truly ready to buy?

We’ve compiled 7 questions to ask yourself to help you calculate your home buying ‘readiness.”

1. Have you paid off your debt?
With part of your money going toward debt payments each month you’ll have an even harder time saving for emergencies and staying on top of expenses.

2. Have you saved an emergency fund?
Speaking of emergencies, it’s recommended to save an emergency fund that will cover 3-6 months of expenses as a safety net.

3. Have you decided to stay put for a while?
Buying a house, is putting down some roots. You need to make sure you’re at the right stage in life, and plan to settle for at least a few years. If you move within a couple years of buying a new home, you’ll likely lose money.

4. Have you determined if you could afford to pay mortgage and home maintenance costs?
When you buy a home, you not only have a mortgage, but you also have the responsibility for all the repairs and expenses related to your home. There is no other landlord, just you. In your home either you are the handyman, or you’re going to hire one. If you don’t want to live on beans or ramen, count the cost first.

5. Have you saved a down payment?
If you don’t take this necessary step and save a down payment large enough for the home of your dreams, you’ll end up with some regrets in the end. Save first and look later to avoid a broken heart. Save at least 20% down of the estimated purchase price to avoid PMI fees being added to your payment to protect your lender. If you can only save 5-10% it’s ok, but you’ll be paying the PMI longer.

6. Have you saved enough cash for closing costs and moving expenses?
Moving costs can add up depending on what you’re moving and how far. Take a moment to research what your estimated costs will be. Closing costs cover your property taxes, insurance, and fees from lender and title companies. This is usually 3% of the purchase price. Plan these into your budget.

7. Have you found a real estate agent you can trust?
A home is a big purchase, one of the biggest you’ll ever make, and you will want to have the best person by your side. An agent is an asset and should be chosen carefully. Don’t settle for a family member or friend or just randomly pick someone from a list. Do your research! An experienced agent will help you get the biggest bang for your buck and will guide you through the process. Take the time to ask the agent you’re interested in a few questions and make sure that they are the right fit for your needs.

Here at Alaska Homes, we would love to help you through the home buying process, feel free to reach out with any questions. We are here for you!