Proper Research is Essential When Buying a Home

Written by Posted On Monday, 18 October 2021 14:36
History of a House History of a House

Finding Out a Home's History and Surroundings is Paramount

Investing in a new property is an important step, no matter if it’s your first one or if you are an investor purchasing multiple properties. There will be fewer headaches after signing the contract, as long as you do proper research of the property beforehand.

This step is called due diligence and it can guarantee that the real estate you intend to buy is legally clear and covers all your needs and requirements. Knowing how to find the history of a house is a vital part of your research. Doing so could uncover something about the property that gives you second thoughts.

Let's take a look at what you should be doing.

What is The Due Diligence Process

Due diligence consists of a set of actions and searches intended to thoroughly assess the exact value and present condition of the property. If you want to purchase a home for you and your family, it's vital to determine that it is in proper condition, and won’t need significant repairs.

One of the most important parts of the process will be hiring a professional home inspector to thoroughly examine the property for defects. A home inspection should never be skipped when buying a home.

At the same time, it is also crucial to check for any property liens or title encumbrances. Doing this kind of research protects you against unwanted expenses and problems that will become yours.

Researching a home's history should take place whether you are buying a condo, townhouse, or single-family home.

Best Time to Do Due Diligence in Real Estate

This process usually has at least two steps. There is some basic research first, which happens before drafting your shortlist with properties that might fit your needs. It is a simple filtration method that will result in several properties that might be interesting according to your investment purpose.

Usually, most home buyers will be interested in the financial aspect, the type of real estate, the area it is located in, and several other basic conditions related to the surroundings.

Yet, your research shouldn’t stop here. Of course, more in-depth research only takes place when you are interested in one specific house, or only with a couple of properties on your shortlist.

The Inspection Period is a Crucial Part of Due Diligence

The more in-depth research comes after this first step. After placing an offer on a property that so far looks good from several basic points of view, you will determine a period of a fixed number of days for the due diligence process. In the purchase agreement, the due diligence is also referred to as the home inspection period.

As mentioned previously, this due diligence or inspection period provision in the purchase agreement gives you the right to terminate the agreement should anything bad and inconvenient might be discovered about the property.

Usually, the inspection period provided in the purchase agreement is not that long, whereas the research process sometimes requires a lot of time as well as waiting for several responses from specialists and authorities. Thus, you shouldn’t waste much time before starting your due diligence.

How to Do Real Estate Due Diligence Efficiently

At first, you might feel that due diligence is something out of your reach. Where should you even start? But if you just start from the most accessible source, you will discover lots of resources, step by step.

Usually, the most comfortable and accessible source is the present owners themselves. Draft a list with all your questions about the property, and don’t be shy in asking every one of them.  Your buyer's agent should also be a resource you rely upon heavily. It is a significant part of any real estate agent's job description.

The Most Common Due Diligence Steps

As we already mentioned, the due diligence process depends on the type of property you are interested in. Nevertheless, here are some universal actions included in this property research.

The Physical Inspection

This will show you the state the property is in, and what type of repairs are required if any. It will also assess the extra investment that you might need to be put towards the property. This inspection is done by specialized inspectors and include:

  • Structure: a house frame, foundation, walls, roof, ceiling;
  • Utilities: electricity, sewerage, heating, air conditioning;
  • Rooms: a detailed check of all rooms and facilities.

After the inspection, you will receive a final detailed report that lists all issues, as well as the major safety problems.

Title Checks Are a Crucial Part of Housing History Checks

Before signing the ownership agreement you need to make sure the respective property is clear and is not burdened by overdue liens. For example, a tax lien might lead you to a foreclosure notice. The best protection against this is title insurance.

The insurance company will ensure that there are no such liens, deed restrictions, or restrictive covenants, or that they will be cleared before the sale. The same title insurance will cover you if any such unresolved issues occur after your purchase.


The due taxes for a property can make it financially accessible or not, alone. You need to know exactly how the sale affects the property taxes. So you need to study the tax laws in the area and make a calculation to see if you can handle them. Also see if any special assessments are required, which lead to extra expenses.


Specific zoning regulations are to be found in all regions. SO check the exact ones in the area you want to buy the property. These local regulations sometimes limit the allowed use of your future property (residential, commercial, office).

If you are paying cash it will also be essential to have a land survey completed to make sure there are no property encroachments taking place. Many people have no idea how many times there is a violation of boundary lines by an adjoining property.

What Neighborhood Are You Getting Into

No matter the good quality of the property, the neighborhood can significantly lower or increase its value or your interest in this real estate. Doing a property history search isn't just about the house but everything around the property too.

Environmental Research

It is common these days to have environmental research before buying real estate. Some contaminated areas might require in-depth cleaning to be proper for living, which involves huge expenses.

You should also check whether the property is in a flood area, so you might properly prepare with the insurance company for that. The standard home insurance usually doesn’t cover this specific hazard.

Financial Report

Since buying a house is always a sort of investment, due diligence must focus also on the financial situation over the last three years. This report will show you clearly if you make a good investment or not by buying it.

Such a review always takes into consideration: property taxes, insurance fees, repairing costs, utility expenses, gross rent, vacancy rate, marketing costs, NOI (the net operating income). This includes specialized data, sol you should analyze the financial report together with a real estate specialist.

Are property values increasing or decreasing is one of the more essential things to evaluate.

Final Thoughts

Due diligence is one of the essential steps in closing on a property. Before closing on a home, you should feel confident you're making an excellent buying decision. Many rightfully consider this step the key to real estate success. Without knowing a property's history you can easily make a purchase mistake.

Hopefully, some of these tips for researching a property have been valuable.

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Bill Gassett

One of the top RE/MAX agents in New England over the last decade plus. Providing exceptional real estate services to buyers and sellers in the Metrowest Massachusetts area including the following communities: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton and Uxbridge MA.

See my real estate website at Maximum Real Estate Exposure - one of the most visited real estate sites in Massachusetts.

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