Buying Too Much House
It is important to be able to enjoy your new home. One of the biggest blunders that inexperienced or overzealous buyers make is to jump right in and get way too much house. How much is too much? If your mortgage is going to burn a hole in your income more than 35%, then it’s time to reconsider. Make sure you can afford to pay recurring expenses while leaving some room to breathe in the process. Just because you may have prequalified for a certain amount does not mean you can “afford” that much house.
Skipping a Home Inspection
We have all seen the horror stories broadcast across home television networks – so much so that there are teams of people trying to educate homebuyers on the importance of a home inspection. What can you stand to lose by skipping the inspection? Anything from faulty structure to chemical exposure or pest infestation or more – can set you back thousands or tens of thousands. Better to be safe and spend a few hundred dollars than to be sorry.
Not Getting Everything in Writing
Just because a seller said you would get to keep the swings set does not necessarily mean you will get it – unless you have it in writing. Too many buyers fail to get things put into a formal contract. In fact, many brokers and agents have specific forms to avoid just that. Make sure every agreed upon item is formally written down, signed by both parties and includes any necessary details.
Not Doing Homework
You can never have too much information when buying a house. In fact, knowing as much as possible about the property, its history, surroundings, neighborhood and community are instrumental in making the right decision. Another important thing to know is current local market conditions. What are other homes in the area selling for? What is the life of the average property in the neighborhood? Are prices stable and is it a sellers’ market or buyer-controlled? A quality, experienced Realtor will help you find out all this and more relevant information – key to finding the perfect home.
Buying the Most Expensive House in the Neighborhood
Even though it may seem like a good purchase – buying the most expensive home on the block is not the best move to make. No matter what you think your long term intentions are for the home, just the chance that you may want to sell in the future is enough to forego buying the priciest home in the neighborhood. Consider this: if you do end up moving, sellers will be turned off by the most expensive price tag making it harder to sell. Not only that, the home’s value is also dependent on other homes in the area – something that could backfire eventually.
Moving Too Quickly
Since buying a home is the largest financial transaction in most people’s lives, it is important for them to pace themselves. Hastily acting on the first home you see will limit you from countless options. While there should be a reasonable limit – it’s a good idea to see more homes than fewer. If you have a list of must-have items, try to achieve all or most of them in your search. You can’t do that if you jump at the first home and sign the dotted line too quickly.
Buying a Misfit House
A lot of buyers are wooed by the lifestyle and living arrangements of the homes as displayed by sellers. Once they move in, they realize things like the oversized lawn is way too much work or that the high-end finishes are too much to maintain with their young family. It is essential to keep your lifestyle in mind when searching for your next home. The last thing you need is to regret or feel buyer’s remorse when it’s too late.
Forgetting to Zoom Out
Many buyers are enticed by the number of rooms a home has, a high-end kitchen or the home’s spaciousness, without considering other aspects of living there. When they have moved in and realize their next-door neighbor runs a daycare or the nearest grocery store is twenty minutes away – they regret it. Remember to research the surroundings in the area to make sure that it’s still your dream home even after zooming out of just the house itself.
Failing to Protect Themselves
There is a reason for contingencies in an offer and without them things can get messy. When buyers neglect to outline the terms or if they choose to waive some important contingencies in the interest of securing the home, they are taking a huge risk. Common contingencies not to forego are the right to a home inspection prior to sale with the sale dependent on inspection results or availability of financing or setting a move-in date that coincides with the sale of the buyer’s previous home.
Foregoing Prequalification and Preapproval
Driving around and looking for a good home is fine but when it comes time to getting serious about the sale, unless you are prequalified and preapproved, you could easily get the short end of the stick. Buyers that don’t pay much attention to this important buying strategy actually end up losing their dream homes because the seller chose to accept the offer from someone that did this important step. Prequalification allows you to know your budget range according to the lenders’ calculations made based on your income, etc. A preapproval is a written statement from your bank saying that you have been preapproved for a loan. Sellers prefer offers that come with both, especially in today’s housing industry with savvy homeowners and buyers.
Do you want to make sure everything you’re doing is spot on? Call or visit us today so we can review your options, help you determine what your perfect home is and introduce you to your new home!
