Knowing how much you can afford to pay is a crucial step in your search. Nailing down your budget early will make the overall process more focused and less stressful.
Here’s a good way to figure out how much you can afford:
The 28/36 rule is an established benchmark used by many lenders to determine how much credit to offer you. Here's how it works:
Get preapproved for a mortgage. Your lender can approve you for a certain to loan amount prior to your home search. This gives you a solid number against which you can assess the affordability of the houses you visit.
The "28" refers to the notion that no more than 28 percent of your gross monthly household income should go toward housing costs, which include mortgage principal, interest, taxes and insurance.
To calculate, simply multiply your gross monthly income (amount before taxes) by .28. Use this amount as a guide for how much house you can afford.
Example: You earn an annual salary of $70,000. Divide 70,000 by 12, giving you a monthly gross income of $5,833. Multiply that by .28, and you'll find you should spend no more than $1,633 each month on total housing costs.
The "36" part of the 28/36 rule refers to your overall debt, which shouldn't exceed 36 percent of your income. This is important to consider because other high monthly debt loads – such as car and credit card payments – impact the amount you can afford to spend on housing.
For first-time home buyers, the tricky part is knowing how much to budget for taxes and insurance. I can assist you with this.
Remington's in Okoboji has great appetizers, salads, sandwiches, steak and much more. Remington's also has daily lunch and dinner specials. Happy Hour Mon - Fri 4pm - 6pm with free popcorn. Saturday is "Game Day" 11am - 4pm with drink and appetizer specials. Lunch and dinner reservations are taken, along with large group reservations with seating up to 150 people. Remington's offers a semi-private dining room that seats 50 people.
Boulders Inn and Suites promises to make your Okoboji vacation comfortable and relaxing. This new hotel just south of Emerald Hills golf course between Milford and Arnolds Park offers 40 rooms with suites to meet your individual needs. One of the best things about Boulders Inn is that it is within walking distance of the Taco House. For some of you, I know that can be a big deal!
Here's the scenario. You are building a house or remodeling your house. Material costs are up. Labor costs are up. You ask yourself, where can I save a buck? Before answering this question, you must be careful, especially if your home is located in an area where other quality homes are built, whether on the lake, off the lake, or in higher valued developments such as golf course developments, etc. Growing up in construction and with a plethora of new construction and remodels under my belt, let me share with you some of the easy things that your future buyers will recognize when they are looking for quality.
1. One of the first things buyers of higher end homes will look for is to determine if the owner used hollow core doors. It's an immediate sign that the seller was looking for ways to save money (where else then did they cut back that I can't see???)
2. The second most obvious is the counter tops. Did the sellers spend for a quality granite, quartz, or other hard surface, or was formica used?
3. The third item that might stick out is the cabinetry. Do the drawers have dovetail construction with hardwoods? Did they use "soft close" drawers? Are there pull outs for the pots and pans?
4. Flooring is an easy one also. Was laminate used, or is it engineered or hardwoods? Does the carpet convey a quality feel and plushness? Is there a nice thick pad underneath the carpet?
5. Though there are many other items to look at, cheap vs quality lighting and plumbing fixtures are probably the next major focus.
There is nothing wrong with with using lower cost materials, especially when trying to keep a project within budget, especially when trying to build more house for less money. Just be aware that most buyers looking to spend in excess of $300k for off lake homes and $500+ for East Lake chain homes, and $1M+ for West and Big Spirit will expect the very best materials and finishes.
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