Area Real Estate News & Market Trends

You’ll find our blog to be a wealth of information, covering everything from local market statistics and home values to community happenings. That’s because we care about the community and want to help you find your place in it. Please reach out if you have any questions at all. We’d love to talk with you!

Oct. 27, 2022

Have a Happy Halloween in Berks County!

Are you ready for a good scare this weekend in Reading? There's Halloween fun for all ages! 

Halloween Party

Sat, Oct 29, 5 – 10 PM
Reading Liederkranz
143 Spook Ln, Reading, PA

Every year we get spooky on at 143 Spook Lane for Halloween and throw a costume party at the Club. This party is lots of fun and we normally have it outside in our Biergarten with live music in the Pavilion. Stay tuned for upcoming details for 2022’s event.

Trunk or Treat

Sun, Oct 30, 9 – 10 PM
4125 Penn Ave, Sinking Spring, PA

Saint John’s Evangelical Annual Trunk or Treat!
Join us for a family friendly night of trick or treating!
Any and all welcome to participate and visit!

Halloween Costume Party

Sat, Oct 29, 10 AM – 12 PM
Wyomissing Public Library
9 Reading Blvd, Wyomissing, PA

We are encouraging families to dress up in Halloween costumes to get into the spirit of the holiday! Kids will have activity stations and there will be candy for Trick or Treating.

Halloween at the Hill

Sat, Oct 29, 5 – 10 PM EDT
Chapel Hill Golf Course
2023 Old Lancaster Pike, Reading, PA

Come join us for our annual Halloween party! Costume prizes, specialty drinks, dinner, and live music!

Spooktoberfest

Fri, Oct 28, 5 PM EDT
Willow Glen Park
115 Aspen Ave, Reading, PA

Looking for a less scary Halloween experience for your young kids?? SPOOKtoberFest is a less scary version of Shocktoberfest. It’s a family friendly Halloween experience is perfect for young children, their parents and grandparents. Price includes the Spooky Hayride, Unknown 3.0 Spooky Haunted House, Midway Massacre Boo Zone, and Zombie Laser Tag.

Additional activities are also available such as Carnival Games, and delicious food from our Food Trucks for an additional fee. Children are welcome to wear costumes.

It runs 5:00 to 7:00 every night Shocktoberfest is open.

 

Have a Happy Halloween!

Oct. 20, 2022

Keep Your Home Furnace Running Smoothly

It gets cold in Berks County in the winter, so you know how vital it is to have a working furnace. Your home stays warm and cozy all year round. Normally, the system runs in the background of your home without your involvement, but it does require some maintenance to remain in good working order.

Over time, you should not be surprised when your system shows signs of problems or stops working altogether if you ignore it for years. Here are a few things you can do to prepare your furnace for the winter.

Get it Serviced and Maintained Regularly

Maintaining your furnace regularly will keep it in great shape for as long as possible. Over time, many furnaces and HVAC systems in general will begin to develop issues that limit their effectiveness or make them less efficient.

In some cases, these signs are obvious, but in others, they will require professional diagnosis and treatment. Once a year, you should have your furnace tuned and inspected by an expert to ensure that all issues are dealt with. A team of experts will examine various components and run tests to ensure everything is in order.

Make sure to take time to find the right company who specializes in Furnace Repair in Berks County. You need to choose one that has a lot of experience and solid reviews backing up their work.

Change the Filter Frequently

Make sure you change your furnace's filter frequently in between visits from a professional to keep it working properly. In addition to preventing dirt, dust, and other debris from entering your HVAC system, the air filter can also help maintain a healthy air quality.

However, this filter will become clogged up over time, making it less efficient. The furnace will have to work harder pushing air through a dirty filter, resulting in a shorter lifespan. It is therefore important to replace the filter periodically to keep everything running smoothly.

When it comes to how often to change your filter, the answer can depend. In some cases, a filter should be changed monthly, while others can last a couple of months. You will generally want to change yours out more frequently if you have pets or kids.

Keep Vents and Registers Clear

Make sure all vents and registers are clear to keep your furnace running efficiently. Covering up these vents will prevent most of the heat from reaching your home's different rooms.

Because your home isn’t heating up like it should, your furnace will continue to pump out more and more hot air, which ends up also being primarily blocked. This can lead to a ton of wear and tear in the system, and even cause your utility bills to skyrocket.

As a result, keeping furniture over vents or blocking registers with clothing piles, boxes, or a variety of other things is generally not recommended.

By keeping these tips in mind, you can make sure that your furnace is always in the best shape possible.

Visit our blog every week for more real estate articles and local Berks County articles. We can help you find the perfect home for sale in Reading and the surrounding communities of Blandon, Boyertown, Douglassville, Exeter Township, Fleetwood, Kutztown, and Oley with our powerful property search tool.

Posted in Real Estate Advice
Oct. 13, 2022

What Drives the Berks County Real Estate Market?

Oct. 11, 2022

Halloween Fun Starts Now in Berks County!

Why wait for Halloween to start when you can start having fun this weekend? Here are some spooky events coming up in Berks County this weekend and on Halloween weekend.

Halloween Party

Sat, Oct 29, 5 – 10 PM
Reading Liederkranz
143 Spook Ln, Reading, PA

Every year we get spooky on at 143 Spook Lane for Halloween and throw a costume party at the Club. This party is lots of fun and we normally have it outside in our Biergarten with live music in the Pavilion. 

Spooktoberfest

Sat, Oct 15, 5 PM
Willow Glen Park
115 Aspen Ave, Reading, PA

Looking for a less scary Halloween experience for your young kids?? SPOOKtoberFest is a less scary version of Shocktoberfest. It’s a family friendly Halloween experience is perfect for young children, their parents and grandparents. Price includes the Spooky Hayride, Unknown 3.0 Spooky Haunted House, Midway Massacre Boo Zone, and Zombie Laser Tag.

Additional activities are also available such as Carnival Games, and delicious food from our Food Trucks for an additional fee. Children are welcome to wear costumes.

It runs 5:00 to 7:00 every night Shocktoberfest is open.

Mohnton Great Pumpkin Parade

Sat, Oct 15, 7 – 9 PM
Mohnton, PA

It is a tradition during the Mohnton-Cumru Lions Club Great Pumpkin Parade that the participants shower the children on the parade route with Halloween candy. To view the streets of Mohnton, lined with little children dressed in their Halloween costumes with hundreds of bright orange pumpkins at the ready to collect all of that candy, you’ll agree, the only name befitting this parade is the “Great Pumpkin Parade”.

Food vendors line the streets and offer a variety of goodies such as Philly Cheese Steaks, hamburgers, hotdogs, funnel cakes, French fries, soft drinks and balloons.

Marching Bands, Floats, Food, Fun and lots of Candy.

Shocktoberfest

Sun, Oct 16, 5 – 9 PM
94 Park Ave, Sinking Spring, PA

Shocktoberfest, Pennsylvania’s Premier Haunted Scream Park. Located off the PA Turnpike near Reading, PA, (Berks County) and is about an hour from Philadelphia, Allentown, Harrisburg, and about an hour and a half from Delaware, New Jersey and Maryland. Shocktoberfest features some of the best and most unique attractions in the country.

2nd Annual Trunk or Treat Car/Truck/Bike Show

Sat, Oct 22, 12 – 5 PM
Gibraltar Fire Company
3351 Main St, Birdsboro, PA

Registration starts at 11am! Entry Fee - By Donation $$$ All Makes & Models Welcome! People's Choice Awards. Bring some candy for the Trick or Treaters.

Chinese Auction, 50/50 Raffle. Donations Benefiting Make-A-Wish!
Rain Date - Sunday, October 23rd, 2022!
For More Information Contact:
Dan #484-942-3025
Mike #484-651-7282

Visit our blog every week for more real estate articles and local Berks County articles. We can help you find the perfect home for sale in Reading and the surrounding communities of Blandon, Boyertown, Douglassville, Exeter Township, Fleetwood, Kutztown, and Oley with our powerful property search tool.

 

 

Sept. 29, 2022

4 Mistakes to Avoid When Buying Solar Panels

A solar panel system can cost tens of thousands or even hundreds of thousands of dollars for your Berks County home. This is why it is important to purchase the right solar system and have it installed properly from the start. 

If you install solar panels correctly, they will last you 20-30 years, lower your energy bills considerably, and increase the value of your home. Here are four mistakes to avoid when purchasing solar panels.

Sourcing Parts Separately

In an effort to save on solar panels costs, some people opt to build Frankenstein systems, whereby they source the various parts separately and have a solar systems expert put them together.

Parts are often mismatched. You may have an undersized inverter, unmountable panels, or a battery that does not match the charging source. As a result, you have a total system failure that is both costly and dangerous. 

Overpaying for the Solar System and Its Installation

Getting multiple quotes for the solar system and its installation is important. Compare the quotes not just based on price but also on the range of services offered. 

The majority of solar companies offer installation and maintenance services, either free of charge or at an additional cost. You should compare interest rates and costs when applying for a loan or lease.

Check consumer reviews for prospective suppliers and service providers on forums such as Reddit and review websites like Pissedconsumer.com. The customer feedback will indicate if the companies are reliable. 

To determine if a company has recurring issues, read the consumer reviews in addition to the overall rating. Watch out for complaints about poor quality solar panels, bad customer service, and unfavorable lease terms.

Choosing the Wrong Type of Solar Panels 

There are 3 main types of solar system designs—on-grid, off-grid, and hybrid. On-grid solar systems are the most common. They are connected to the public electricity grid. As such, the system does not require batteries. 

In the event that solar is not enough to meet your power needs, the switchboard will import electricity from the grid to make up the difference. A major disadvantage of this system is that a power outage in the main grid will also result in a blackout.

Off-grid systems are not connected to the main grid. They are most suitable if your house is not connected to the public electricity grid, such as if you live in a remote area. Since there is no supplemental power source, the solar panels have to generate enough power to meet all your energy needs.

As off-grid solar systems require expensive batteries and inverters, they are more expensive than on-grid systems. You may also need a backup generator to supplement the energy in the winter season when the solar system cannot produce enough power.

A hybrid system requires more expertise and is more complex to install. Those units are connected to the main grid and have batteries for storing energy. As soon as the battery's energy is depleted, the grid backs up the battery.

Wrong Size

The right size of a solar system depends on various factors, including your energy consumption, power rating, battery size, energy efficiency, sun hours per day, and the number of panels. 

It is best to consult with a solar systems expert about the ideal size of a solar system for your home. They will accurately calculate your daily energy consumption and recommend the most suitable solar system size according to its efficiency, power rating, and output.

When sizing, keep in mind that solar panels lose 0.5-1% efficiency annually. Therefore, in 20 years, the solar system will have lost 10-20% efficiency. Therefore, account for the efficiency loss when choosing a solar system. 

Are They Worth It?

Are solar panels worth it? Yes. They lower your energy bill and improve the value of your Berks County home. However, the caveat is that you have to choose the right solar system design, layout, and size for your home.

It is best to get a complete unit from one supplier instead of sourcing parts separately. Also, check online reviews to establish the credibility of prospective products, suppliers, and installation service providers. 

Visit our blog every week for more real estate articles and local Berks County articles. We can help you find the perfect home for sale in Reading and the surrounding communities of Blandon, Boyertown, Douglassville, Exeter Township, Fleetwood, Kutztown, and Oley with our powerful property search tool.

Posted in Real Estate Advice
Sept. 22, 2022

Consider This Before Buying Furniture for Your New Berks County Home

You've found the perfect home for sale in Berks County and closed the deal. Now for the fun part - buying furniture! But hold on, don't get carried away. Doing so can lead to costly mistakes. When it comes to buying furniture for your home, there are a number of points to consider to make sure you buy the right items.

Measure Twice, Move Once

Will your new luxury leather couch fit through the front door, or any of your doors? There’s nothing more frustrating than buying a piece of furniture and not be able to get it in the house. Also, consider the size of the room you’re placing your furniture. Would it be too big or small? Make sure that you get the measurements on the furniture you’re buying and compare it to the space you plan to put it. You can also download an app for your pad or phone that will help you visualize how furniture will look in your home.

Maintenance

Hardwood furniture is certainly appealing and will last for many years, but it does take more maintenance than furniture made with synthetic materials. Make sure that you have the time and know-how to care for hardwood furniture before you invest in it.

Avoid Fads

Will that trendy chair or sofa still be in style next year? If you want to avoid having your home look dated, consider more classic styles. Classic styles will outlive trends for generations and always keep your home looking good.

Take Some Time

There’s no law that says you have to buy the first piece of furniture that strikes your fancy. It’s a lot like buying a home. Did you buy the first home you saw? Probably not. When you take your time, there’s more of a chance of finding the best products that will compliment your home.

Think Ahead

What are your living plans over the next few years? Are you staying in your home indefinitely? Or are you planning to upgrade in the a few years? Base your furniture choices on your plans as much as possible and you won’t have to spend more money than you need to if you do move.

Cost and Budget

Lay out a budget before you dive into the furniture stores or shop online. And of course, furniture stores have all sorts of sales and plans to get you to buy more than you need. Stay focused on your goals and budget. If you buy furniture using credit plans offered by these stores, you will pay more than you need to for items that are not necessarily of higher quality. Remember – furniture stores exist to make money.

If you keep these thoughts in mind when buying furniture for your home in Berks County, you can make great choices that will make your home look amazing for years to come.

Visit our blog every week for more real estate articles and local Berks County articles. We can help you find the perfect home for sale in Reading and the surrounding communities of Blandon, Boyertown, Douglassville, Exeter Township, Fleetwood, Kutztown, and Oley with our powerful property search tool.

Posted in Home Buyers
Sept. 15, 2022

What First Time Berks County Home Buyers Can Do If They're Priced Out of the Market

Berks County first-time homebuyers face a major challenge when it comes to buying a home. There is still a record rise in home prices, despite a slight cooling. The median home price in the U.S. has surpassed $400,000 for the first time ever.

This trend is likely to continue due to several factors. Housing supply is limited, there are a lot of motivated buyers, and mortgage rates are low. Prices are rising for everything, including homes, due to inflation. Since mortgage rates are low, buyers can buy more than they would otherwise be able to, resulting in heated bidding wars.

Additionally, sellers are staying put to avoid a highly competitive buying market, further reducing the supply of homes for sale.

In addition to being unable to obtain materials, homebuilders are also facing a labor shortage.

Where does this leave first-time Berks County home buyers or any buyer?

What Does It Mean to Be Priced Out?

Buying an entry-level home is out of reach for someone who is priced out of the real estate market. A number of factors can lead to first-time buyers being priced out, many of which are converging at the moment.

You may have noticed that the down payment you saved hard isn't going as far as you expected. You might not be able to afford a house if you only saved 20% of the price you were preparing to pay.

So, what can you do?

You might think automatically you should keep renting, but rent prices are going up because of inflation as well, while wages aren’t keeping up, so this isn’t the ideal option.

There are a few things you can do, and none of them might feel ideal, but your options are limited when you’re priced out.

Save More

It may be necessary for you to keep renting and add to your savings if you live in an unaffordable market right now. As a result, you can also wait out the market in some respects. You may need to be patient because it could be a couple of years before you’re able to re-enter the marketing successfully.

It's better to consider your monthly expenses rather than the sales price when determining what you can afford.

Put your money in a savings account if you plan to wait out the market for a while. Some of your savings may need to be invested in riskier, but higher-earning options like stocks.

Change Your Expectations

You can also change your expectations when you're priced out of the market. Due to limited inventory and other factors affecting the market right now, you may have to give up a few items on your wish list.

You could end up buying a fixer-upper that’s more in line with your budget.

For first-time buyers, being humble is key to getting a home in the current environment.

Broaden Your Home Search Geographically

As you might have to give up some of your wish list as far as home features, you might also want to broaden the geographical area you're looking in. Depending on the neighborhood or suburb in Berks County, home prices can differ considerably.

Hire a Great Real Estate Agent

Finally, if you don’t already have a great real estate agent on your side, it would be nearly impossible to navigate the current market as a first-time buyer without getting one. Even if you can find a home you’re able to afford, you may be facing stiff competition.

You will have an edge over other buyers since real estate professionals are aware of properties before they go on the market. They’ll also be able to help you understand your local market so you can adjust your expectations as needed.

By negotiating on your behalf, a real estate professional can reduce your stress. James Ernst has the experience you need to help you navigate this stressful market.

It’s not an easy time to buy a home, but that doesn’t mean it’s impossible. You might wait it out, or you could shift your approach and strategy a bit. Call us today to talk about your home buying options in Berks County.

Visit our blog every week for more real estate articles and local Berks County articles. We can help you find the perfect home for sale in Reading and the surrounding communities of Blandon, Boyertown, Douglassville, Exeter Township, Fleetwood, Kutztown, and Oley with our powerful property search tool.

Posted in Home Buyers
Sept. 8, 2022

Fall Festival Fun This Weekend in Berks County!

It's festival time in Berks County! Get ready to have a great time with these fun fall festivals in and around Reading this weekend.

Chile Pepper Festival

Sat, Sep 10, 9 AM – 6 PM
Bowers Park
233 Bowers Rd, Mertztown, PA

The Largest Chile Pepper festival of its kind anywhere. A must attend event for Chile pepper lovers. Includes music, Salsa Contest, Jalapeno Eating Contest.

Family friendly. No alcohol. Admission by donation.

Hay Creek Festival

Fri, Sep 9, 6 AM – Sun, Sep 11, 1 PM
Haycreek Valley Historical
1250 Furnace Rd, Geigertown, PA

Welcome to the 46TH annual Hay Creek Festival. This annual heritage festival is the most diverse event in Berks County, Pennsylvania and features over 1,500 volunteers bringing together two centuries of history with authentic demonstrations of early American trades and crafts, mechanical technology exhibits, old time music, and a modern craft & antique market. So “Step into the Past” and immerse yourself in a history that our forefathers would be proud of experiencing.

2nd Annual Berks County Music Fest

Sat, Sep 10, 12:00 – 1:15 PM
Mohnton Playground Association
Walnut St, Mohnton, PA

Presented by The Mohnton-Cumru Lions Club and featuring The Uptown Band, Smith Compound Band, and The Large Flowerheads! Event runs from 12:00 PM - 7:00 PM!!! $15.00 in Advance / $20.00 at Door.

Berks County Rock & Roll Hall of Fame Induction Happening

Sat, Sep 10, 4:30 – 10:00 PM EDT
FirstEnergy Stadium
1900 Centre Ave, Reading, PA

The Berks County Rock & Roll Hall of Fame, (BCRRHOF), has partnered with The Reading Fightins and The Reading Musical Foundation to present our Berks County Rock & Roll Hall of Fame Induction Happening at First Energy Stadium on Saturday, September 10, 2022, with live music jam starting at 4:30.

General admission tickets are on sale in advance at First Energy Stadium or at the gate. Special VIP picnic area tickets for admission, food and beverages may be bought in advance at Deck Picnic Ticket: groupmatics.events/event/Berkscounty

Visit our blog every week for more real estate articles and local Berks County articles. We can help you find the perfect home for sale in Reading and the surrounding communities of Blandon, Boyertown, Douglassville, Exeter Township, Fleetwood, Kutztown, and Oley with our powerful property search tool.

Posted in Community Events
Sept. 1, 2022

Signs Your Berks County Chimney Needs Repair

All Berks County households with fireplaces or wood stoves must have chimneys. They reduce the amount of soot and fire embers indoors, resulting in cleaner and healthier air. Your rooms can have grease-free walls and floors thanks to chimneys.

In contrast, houses without efficient chimneys tend to have stained walls and ceilings. There is also a possibility that floors will appear greasy. You and your family may also suffer from poor indoor air quality due to the high concentration of particulate matter. 

So, for property owners like you, maintaining and repairing chimneys is a must for ensuring their maximum performance. Unfortunately, being able to tell when a chimney needs repair can be tricky. 

This post will discuss different tell-tale signs you can spot to help you tell whether you need to schedule a chimney repair job the soonest or not. 

White Staining

A white stain, also known as efflorescence, indicates moisture problems in your chimney. Usually, these appear as crystalline stains on brick and concrete. In small amounts, it may not be a concern, but large deposits could lead to severe moisture problems.

The common causes of this issue are damaged liner and loose flashing, leading to massive mortar deterioration. If your chimney has this issue, you may want to hire a reliable chimney repair company. You may ask for a new flue liner installation or repair the crown's flashing.

Damaged Mortar Joints

Mortar joints deteriorate over time because of adverse weather elements, such as rain and snow. When this occurs, the mortar joints are exposed to more moisture issues that may lead to structural damage to the chimney.

As the chimney freezes, moisture seeps into existing cracks and further damages it. A chimney collapse may result if ignored. In order to solve this problem, you should replace the old mortar joints with new mortar at least an inch thick. The repair may also be strengthened by adding mortar sealant.

Cracked Chimney Crown

Due to extreme weather elements and natural wear-and-tear, chimney crowns lose their structural integrity, weaken, and collapse. When this happens, major water leaks and further structural damage, such as broken tiles and rusted dampers, occur. To address the damage, a chimney mason may caulk the flue liner or replace cracked bricks or tiles.

Rust

The metal components of your chimney may rust when they are repeatedly exposed to moisture and oxygen. A common cause of this problem is improper maintenance and natural wear and tear. Also, excessive rust could indicate a bigger hidden problem, such as cracked flue tiles.

When signs of rust appear in your chimney, you may need to seek a chimney sweep for rust removal immediately. Neglecting this issue may lead to more serious trouble, such as structural damage and collapse.

Falling Tiles

Falls tiles are caused by improper tile setting and water damage. The chimney materials may flake as a result. Chimney areas without tiles are more prone to damage as there's no more extended protection for the concrete.

Falling tiles are dangerous and should be addressed immediately. For this purpose, tile replacement is necessary. This could be partial and will only cover a particular damaged area. On the other hand, if it's a total replacement, the entire chimney brickwork may be replaced.

Dirt Buildup

If soot and greasy walls appear not just in the chimney but also in the kitchen walls, a chimney problem may occur. In most cases, this is caused by interior chimney structural issues, such as cracking or settling. When this happens, the smoke from the kitchen may find it challenging to go upward quickly; thus, the soot and wall stains appear.

Spalling

Spalling refers to the popping out or peeling off of the exterior portions of a chimney. This usually happens when moisture repeatedly enters and exits the chimney's masonry. Many chimney contractors suggest quick masonry repairs to avoid massive chimney damage or even a total collapse. In some cases, the complete brickwork is replaced.

Chimney Leaks

When leaks, such as pools of water, appear in the fireplace or its adjacent area, a moisture problem is indicated. When this happens, you should apply immediate assessment to know the cause of the problem. With this, one could provide prompt and appropriate repair, such as defective flashing, damaged crown, or deteriorated mortar.

Early damage prevention is one of the best ways to avoid more significant structural chimney problems. The first step for early prevention is knowing the typical signs of chimney damage. For this purpose, reading this feature is necessary. Aside from providing the usual signs of chimney damage, it also offers tips on how to repair them accordingly.

Visit our blog every week for more real estate articles and local Berks County articles. We can help you find the perfect home for sale in Reading and the surrounding communities of Blandon, Boyertown, Douglassville, Exeter Township, Fleetwood, Kutztown, and Oley with our powerful property search tool.

Posted in Real Estate Advice
Aug. 25, 2022

How to Figure Out How Much Mortgage You Can Afford to Buy a Home in Berks County

Owning a home in Berks County should give you safety and security, and that includes being financially secure. Before you buy a home, you should calculate how much you can afford for a mortgage and make sure it fits safely withing your budget.

Prepare a Detailed Budget

The standard rule of thumb says that you can afford a home that costs 2 to 3 times your gross income for one year. In other words, if you earn $100,000 in a year, you should be able to afford a home between $200k to $300k.

There is one problem with this rule. It doesn't factor in your monthly expenses and debts. If we use our previous example of $100k per year income, and you have $1000 monthly debt payments, this leaves you with less money to pay the mortgage.

You should prepare a family budget that takes into account your ongoing monthly bills for everything — credit cards, car and student loans, lunch at work, day care, date night, vacations, and savings.

Now you can see what's left to cover the costs of owning a home, such as your mortgage, property taxes, insurance, maintenance, utilities, and community association fees, if applicable.

Factor in Your Down Payment

Having enough for a down payment is also an important factor to consider. It's simple: the higher the down payment, the lower your monthly mortgage costs will be. If you put down at least 20% of the home’s cost, you may not have to get private mortgage insurance, which protects the lender if you default and costs hundreds each month. That leaves more money for your mortgage payment.

The lower your down payment, the higher the loan amount you’ll need to qualify for and the higher your monthly mortgage payment.

But, if interest rates and/or home prices are rising and you wait to buy until you accumulate a bigger down payment, you may end up paying more for your home.

Consider Your Overall Debt

Lenders generally follow the 43% rule. Your monthly mortgage payments covering your home loan principal, interest, taxes and insurance, plus all your other bills, like car loans, utilities, and credit cards, shouldn’t exceed 43% of your gross annual income.

Here’s an example of how the 43% calculation works for a home buyer making $100,000 a year before taxes:

  1. Your gross annual income is $100,000.
  2. Multiply $100,000 by 43% to get $43,000 in annual income.
  3. Divide $43,000 by 12 months to convert the annual 43% limit into a monthly upper limit of $3,583.
  4. All your monthly bills including your potential mortgage can’t go above $3,583 per month.

You might find a lender willing to give you a mortgage with a payment that goes above the 43% line, but consider carefully before you take it.

Use Your Rent as a Mortgage Guide

If you currently are renting, then you can use an online calculator to compare the costs of renting vs owning a home to see which makes the most sense for your financial situation.

If you’re struggling to keep up with your rent, buy a home that will give you the same payment rather than going up to a higher monthly payment. You’ll have additional costs for home ownership that your landlord now covers, like property taxes and repairs. If there’s no room in your budget for those extras, you could become financially stressed.

Also consider whether or not you’ll itemize your deductions. If you take the standard deduction, you can’t also deduct mortgage interest payments. Talking to a tax adviser or using a tax software program to do a “what if” tax return, can help you see your tax situation more clearly.

Visit our blog every week for more real estate articles and local Berks County articles. We can help you find the perfect home for sale in Reading and the surrounding communities of Blandon, Boyertown, Douglassville, Exeter Township, Fleetwood, Kutztown, and Oley with our powerful property search tool.

Posted in Home Buyers