When it comes to getting to know the housing market, it's important to know all of the options available. These days, many people are considering options beyond the typical house versus apartment discussion. Read on to learn about different options available in housing today!
While condos, or condominiums, can look a lot like an apartment, they are different in that each unit in a building containing many homes is available for purchase separately. Thus, if you want the vibe of apartment living but want to start building equity, a condo might be the right fit for you.
The most typical kind of house, the single-family designation simply distinguishes a house from a duplex (a house with two separate dwellings inside) and from multi-unit housing like apartments and condos. Purchasing single-family houses or renting them are both options in most markets.
One of the trendiest kinds of housing, tiny houses refer to the return to very small dwelling spaces that take full advantage of all the space available for storage and make use of outdoor living space due to small conditions inside. According to The Tiny House, they are often 60-400 square feet, though there is also a resurgence of interest in small homes, which usually are 400-1000 square feet.
By choosing to buy a home that you won't be living in, but will rent to others, you can begin to be a "real estate investor." Many investors apply for low-interest-rate mortgages and can slowly invest in the equity of the house using the rent from tenants. Investment homes can also be a hybrid of investment and dwelling space, such as vacation rental property used by the owners for only a week or two a year.
Modular homes, according to The Balance, are built in a factory in pieces and are assembled on-site to create the entire home. This process can reduce the construction time to very little - even as little as two weeks! - and they tend to be very energy efficient. Looking into options for modular homes is a good idea if you want a new home quickly and want to have some say in the design.
This term references choosing to purchase a home and contract for the building of a house on that land separately. It can be complex because the loan products involved are different from those for a currently-existing house and land together. You'll also need to be in great communication with your builder, since steps like securing building permits can be more complex than you might think, according to LandCentury.
This delicate term indicates a home that requires significant repairs, usually so much so that the home is not what is known as "move-in ready." When choosing a fixer-upper, most new homebuyers will also look into a "rehab loan," which gives them money to make substantial and expensive repairs. When a fixer-upper has a good structure but substantial cosmetic issues, it often is less attractive on the housing market. That being said, for those who like a project and have a vision for what a fixer-upper could be, this can be an exciting and lucrative way to purchase a home.
A foreclosure is a home that has been seized by a bank or sold as a part of a bundle of such seized properties. These homes come in a variety of states, given that different circumstances lead to foreclosure. In general, there can be good deals on foreclosures, but they come with different legal hoops to jump through and are not as straightforward of a purchase process as a direct sale from a single owner to the buyer.
According to Investopedia, a short sale is "selling a house for less than the outstanding mortgage on it." Short sales are not foreclosures, since they don't affect the previous homeowner's credit as much as a foreclosure. The biggest thing to consider before you participate in a short sale as a buyer or as a seller is to consult with trusted realtors or mortgage lenders, since the process is lengthy and paperwork-intensive.
Now that you are armed with some important terms, you can explore all that is available to you in the world of housing.
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