Buying a house for the first time: 15 Common mistakes made by home buyers for the first time
Everybody wants to owe its home but nobody wants to deal with the all this buying mess. According to many buyers, all this hectic things are quite avoidable.
Just learn from the mistakes of others and try not to make your own ones.
These tips will help you to become successful homeowner and to find the right property for buying. Learn about the common mistakes so you can avoid them in your search for a new home.
Deciding not to hire a real estate agent
You may think that you do not need realtor to buy a house, but you may disregard his services when you meet any problems to solve. You need someone to tell you about your right and to help you. And you must realize that the seller’s agent can help you, but he has the seller’s interests in mind, but not yours. This person will be involved in buying process to serve the seller. And if you want to be guided in the right direction, helped with negotiating your bid, having your offer countered and the process of buying organized, it’s better to have a real estate agent on your side.
Mistake # 2
Concentrating on one home for sale
On some stages of buying process you may assume that there is nothing better out there. But remember that near every home of your dream there are some identical others. In every neighborhood you can find home which can be a pure copy of the previous one. So do not concentrate on one house for sale, think wider and give yourself an opportunity to find something better. Moreover, being usually built by the same constructor, these homes, maybe not identical, but can offer you the same features. Even with a long list of must-have things you still always have an opportunity to find a house for sale which will meet your needs. Always consider moving on in case of major repair issues, difficult possession date, inflexible asking price etc. Such rush decisions as buying the first home you like will make you regret in the future.
Getting tied to home
Falling in love with the house you cannot afford is one of the biggest mistakes while buying home. It is usually very difficult to go back once you’ve found a house for selling you consider to be yours. The problem is, you start dreaming about your ideal life in this ideal home with everything nearby: tree-lined streets, green parks, kitchen with space for everyone and hospitable neighbors. It goes without saying, you can do it if you are sure you can pay for it. In case you are not confident that you can afford this property, do not imagine yourself in it. Set your price range and look at the houses of this range. It will help you to avoid temptation of thinking about the house as already yours. It will save you from the would-be disappointment when you will hear the price of the apartment. Starting to search at the low end of this price range – that’s what you should do. And if there is a house which suits you, you do not need to go higher.
Skipping the home inspection
About 10% of the new homebuyers were not inspected. Trying to cut the costs they did not have the home inspection when during 2-4 hours the estate inspector is searching for material defects of the property. But the aftermaths of it can be very sad – the homebuyers need to pay thousands of euro to repair the things they expected to be in perfect condition. Usually the starting price for home inspection is €450 and depends on age and size of the house. Of course, you can do the inspection yourself, but you need a trained eye to see the existing problems.
What should be inspected? Attics, basements and mechanical rooms are among ” must have”. If there are any odd smells, stains or cracks, you should ask the home inspector about it. Maybe it will save you from some latent problems, which cannot be seen at the moment, but are potential. Depending on the region where you are supposed to buy property, you can be offered to make foundation inspection. Usually almost all of the houses inspected in such a way need stabilization. The foundation of the house is very important structural component. All kinds of damage can happen if the foundation is unstable or fails. If it’s not identified on the very beginning, you will have to pay a lot of costs after buying property.
Forgetting to ask all the necessary questions
Some home buyers feel too shy to ask all the necessary questions before they buy apartment. And some of them just think that these questions are stupid and it’s better to find the answer on one’s own. But, unfortunately, it’s you who’s paying money and you can ask whatever you want, before making sure it’s really what you wanted to buy. Ask about the transport near your home, bus, metro, tram station and departing schedule. Ask about the electricity and gas meters, about broadband, energy and phone suppliers, about main stopcock and thermostat. If you do not know how to use any of the appliances, ask to get manuals for them. Parking place, neighborhood, schools and shops – that’s what you should be interested in. And even home surfaces and cleaning products for them – that’s also among the questions. Being acknowledged means being protected.
Not thinking about the future
Every experience buyer can bet that the thought about selling home would not even cross your mind on the very beginning of buying process. But not thinking about the future is a bad example and a common mistake of rookie home buyers. Anyway, you should expect that maybe you will not live in this house for the whole life, or maybe your children will live there and one day they will decide to sell home. And life is always full of surprises. You may decide you do not want to live there anymore at any moment. That’s why it’s so important to consider the resale value of the property you plan to buy. Will it be easy to sell the property when the time comes? Or you may face some difficulties? While you are hunting for home, take into accounting some preferences of the typical home-buyers. Think it over again. Typical home-buyers. Of course, you may enjoy the landscapes somewhere only you know, far from people and civilization. But it does not mean the other people do. And you may really fail to sell this property when you will be exhausted of all this uniqueness and remoteness of your present property. Just imagine you are the seller and you have to sell the property in the future. Do you consider it to be easy? Then you can buy it for sure. But if you have big doubts about its chances to be sold, then put this idea aside and find something more appropriate.
Offering too much
Finally, you’ve found the place you like and decided to buy a house. But you can be thrown into the bidding war, because there is a lot of competition in your market. There is a fear that you will have to offer the high price just because you WANT this property for sale, not because it’s worth it. The reason people do it is understandable – they want to get this house first. But there are some problems which can arise. To begin with, if the property does not appraise at the amount of money you offer, the bank will not give you a loan. In order to get it, the seller should reduce the price, or there is another option – you will have to pay cash for the difference. In this case you will have to pay the shortfall on your bid out of the pocket. Then, when you go to sell property, if the market conditions remain the same or worse than they were when you made house purchase, you risk losing much money because the situation with the mortgage may be upside down and you will be unable to sell home. To make sure the price you offer for buying property is reasonable, compare sales in the location you plan to buy. And also do not forget to ask the opinion of your estate agent before making any bids and overestimating the property.
Not taking into consideration extra costs
Never forget that buying process involves not only replacement rental payment with mortgage payment. Take into consideration such added costs as expenses on maintenance, utilities, taxes on property. People usually forget about extra costs when they are thinking about how much they can afford for buying house. Figure in all these costs to know the real price of the house for buying. Otherwise the actual monthly payment can be out of your price range. It’s recommended to ask about average utility costs and taxes on property. Of course, the homeowner can give you the answer, but if you have such an opportunity, always try to ask the neighbors with the similar houses – as far as they are not interested in you buying home, they will give you unbiased and trustful answers. Run the numbers you will get to know if you are still able to afford this property. Ask your realtor about the closing costs which should also be considered before buying home.
Visiting the future home only 1 time
It’s OK if you bid on the first house you see, but to make sure it’s the right decision, you’d better visit the place to see the property for sale for the second time. It’s better to do it in the other time of a day. It will help you to see the home from the other side and to notice other aspects of it. Maybe your eye will catch something unseen before. And only after visiting a house multiple times submit your offer. Do not make any hasty decisions and avoid the pressure from the side of the seller, who can push you to buy property faster, because he’s motivated and ready to sell. The moment when you signed the purchase contract is the point of no return. Not only visit the apartment for the second time, but also visit the district again, drive through, and observe the place carefully. Maybe you’ll notice rowdy neighbors or noisy children. Check the neighborhood when the majority of people are at home.
Rushing to buy
One of the most widespread mistakes among those who buy property for the first time. Of course, in a hot market, when you need to buy a house you like, you should put the trigger faster. But the need to make an offer should be balanced with the need to make sure the home is suitable and affordable for you. In a rush to make an offer you can neglect such important things as inspecting the home and the neighborhood. Usually in order to see the whole picture one needs to see the house at different times of the day. Making such an important decision needs time and cannot be done in a few hours. Otherwise you will regret buying this property. Time gives you the opportunity to make a research, which is extremely important to find the right house. When you decide quickly where you want to live and what you want to buy, you’re usually being controlled by your emotions. And that’s why you are not able to look at home from different prospective. Come here tomorrow in the morning, rent room for night to feel the atmosphere of the place, walk through the district and talk to locals – that’s what will help you to buy home – not rushing and trying to be the first.
Neglecting to get everything in writing
A lot of first time buyers neglect to get everything in their contract, because expect it to be negotiated without writing in the agreement. As a result, sometimes after buying home they do not find there some things they expected to be left. The drapes are taken down, the kitchen is without appliances and so on. If you do not want your would-be house with nothing in it just because you “believed and expected”, put down everything in writing. It’s all about hut tubes, window treatments, light fixtures, ceiling fans and bath and shower appliances, dryers and washers. If you decide to replace something it may cost you a pretty penny. So make sure you wrote down all the conditions of purchase into the sale contract. It will protect your rights in case you find something you and the seller were not negotiating about.
Spending too much money on a house
Your affordability is based on the information from your credit report and the documents about taxes. But sometimes you can be approved for a loan which is larger than you can afford. Just keep calm and follow your original price range instead of accepting a higher mortgage loan. You can feel excited and delightful about splurging money and buying everything for the house, but your mood can be pretty spoilt after getting all the bills. Your disposable income can be affected much by the expensive utilities. So try to save money, not buying unnecessary things and thinking carefully about your real needs.
Hiring a wrong realtor
Instead of making such mistake as not hiring a real estate agent at all you can make another one: hiring a wrong one. And it’s one of the most common mistakes of those who are buying home. Do not pick up your realtor blindly. If you find the realtor you are not comfortable with, you will not be able to deal with the purchase process. If you do not want it to be doomed to failure, just be careful while hiring a real estate agent. Remember, that it’s a person who will lead you through the whole process of purchase. If you are a first-time buyer, you will consume more time and require more attention. That means that you should find a real estate agent who will meet your requirements and will dedicate as much time and efforts as you need in order to make the right decision. If the real estate agent is professional, he will save your time and also save you from stress and worries. He will do it by showing you the apartments which fit your needs and will not make any pressure on you. The real estate agent will help you with bidding and buying strategies, will help you to negotiate with the seller and will be friendly and open-minded. Even more, the realtor, hired by you, should be experienced in working with first-time buyers, and be able to communicate and teach them those things and buying techniques, which were unknown. You should feel at ease with the real estate agent and be confident about this person. All the financial options should be discussed between you and real estate agent, to avoid misunderstandings in the future.
Making an endless wish list
If you think that you can get almost everything from your wish list, you may be wrong. Some close-minded rookie home buyers make that mistake – they think that they can and that they should get all these things for their houses. Before hunting for property, just sit down with a realtor and create a list. Include there things you want and things you need. Compare them. There are some must have things which should be included in the property for sale. Everybody expects the access to transportation, the ability to spend some time near their future home, the safety of the neighborhood and so on. All these really necessary things should be added to the list of things you really need. They are primary. But you may also desire some extra things, which you should add to the other list. Extra room for the office, large balcony, new appliances for the kitchen. You may want all these things or you may need them. So think carefully, because all these extra things require extra money. And also make a list of things you would love to avoid. There are some parameters you do not want in your future house. The real estate agent will find you the results which do not have these unwanted characteristics. Try to be always flexible, because you may found a perfect property which fits almost all your needs, but does not have that one “extra”. So be sure that your priorities are properly arranged.
Buying in adverse market conditions
The housing market is a complicated thing, it goes without saying. But the worst thing about it is that it’s always changing and you can never tell if you can fit it or not. The time when the market favors buyers is the best for you as for the buyer. Supply and demand define if the market is favorable or not. If there are a lot of people hunting for property, but few houses for sale, then the housing market conditions are favorable to sellers. They will be able to sell the property at a higher price than it would while the housing market is going to favor buyers. Your task is to wait until there will be les people who want to buy and more homes for sale. The name for it is buyer’s market. As far as less people are looking for a house, there is a bigger opportunity that the seller will reduce the price of the property. It will make their house more appealing to the buyers. And it’s your chance to get your dream home for the lower price! Usually it’s the ideal time for you to buy a house and making your plans come true. A little research into the housing market of your area can never be once. If the information you found is unclear to you, hire a real estate agent, which will help you to clarify the situation. Now, if you know, when to buy a house, there are more chances the purchase will be successful.
And, in the end of a day, trust yourself and listen to the feelings inside of you, but do not forget about voice of reason as well. They say you should learn from your own mistakes. But not in case of buying home, take our word for it.