Housing

## When to Use User needs help with real estate decisions: buying first home, renting apartments, investing in property, or managing rentals as landlord. Agent handles research, analysis, comparisons, and compliance checks. ## Quick Reference | Topic | File | |-------|------| | Buying checklist | `buying.md` | | Renting guidance | `renting.md` | | Investment analysis | `investing.md` | | Landlord operations | `landlord.md` | ## Core Rules ### 1. Verify Local Context First - Real estate is hyperlocal — prices, laws, taxes vary by city/country - Ask user's location before ANY market advice - Never assume US-centric terms (HOA, closing costs) apply elsewhere - Research local regulations: tenant rights, rent control, transfer taxes ### 2. Calculate Total Cost of Ownership | Category | Include | |----------|---------| | Purchase | Down payment, closing costs, transfer tax, notary fees | | Monthly | Mortgage, insurance, property tax, HOA/community fees, utilities | | Hidden | Maintenance (1-2%/year), vacancy (rentals), capex reserves | Never quote just the listing price — always estimate true monthly/annual cost. ### 3. Separate Roles Have Different Priorities | Role | Primary concerns | |------|-----------------| | First-time buyer | Affordability, mortgage approval, inspection red flags | | Investor | Cash flow, cap rate, appreciation potential, tenant demand | | Renter | Lease terms, rights, hidden fees, neighborhood safety | | Landlord | Tenant screening, rent pricing, legal compliance, tax deductions | Confirm user's role before advising. ### 4. Use Current Data Cautiously - Real estate markets shift monthly — acknowledge data staleness - Provide frameworks for analysis, not specific price predictions - Recommend local sources: MLS, government registries, local agents - Flag when information might be outdated ### 5. Financial Analysis Standards For investment properties: - **Cap Rate** = Net Operating Income / Purchase Price - **Cash-on-Cash** = Annual Cash Flow / Total Cash Invested - **1% Rule** (quick filter): Monthly rent ≥ 1% of purchase price - Always stress-test: what if vacancy doubles? rates rise 2%? ### 6. Document Everything Transactions require extensive paperwork: - Pre-approval letters, earnest money, inspection reports - Title search, insurance, closing disclosure - Lease agreements, move-in inspection, security deposit receipts Create checklists for user's specific transaction type. ### 7. Red Flags to Surface | Signal | Risk | |--------|------| | Price significantly below market | Hidden damage, legal issues, scams | | Seller rushing closing | Undisclosed problems | | No inspection allowed | Major structural issues | | Landlord avoiding lease | No legal protection | | HOA financials unavailable | Special assessments coming | Always recommend professional inspection and legal review. ## Housing Traps - **Comparing unlike markets** — Tokyo rent dynamics ≠ Austin ≠ Berlin; never apply one market's rules to another - **Ignoring opportunity cost** — down payment could be invested; compare scenarios - **Emotional anchoring** — "dream home" bias leads to overpaying; use comparable sales data - **Underestimating transaction costs** — buying/selling costs 5-10% in most markets - **Assuming appreciation** — property values can stagnate or drop; don't count on gains - **Skipping tenant screening** — one bad tenant costs more than months of vacancy - **Missing lease clauses** — break fees, renewal terms, maintenance responsibility often overlooked