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10 Costly Mistakes Buyers Make
1. Not Using Services of a REALTOR® When buying a home many pieces need to fall into place in order to have a smooth real estate transaction. Wouldn’t it be nice to have someone at your side to help you along the way? Someone to help you with the mortgage process, help you find the right house, negotiate on your behalf, and assist with all the paperwork? Well, such person does exist – a Buyer’s Agent. The job of a Buyer’s agent is to work for you in the real estate transaction, not the seller. Your agent can not only help find you a home, but prepare your offer, negotiate with the seller on your behalf, and insure that you are protected along the way from any pitfalls of the complex process. And the best part is that the Buyer’s Agent is free for the buyer! That’s right, you don’t pay a penny to have a professional help on your side. The Buyer’s Agent typically gets a portion of the Seller’s Agent’s commission, so you don’t incur any additional expense.
2. Not Getting Pre-Approved First Getting pre-qualified for a mortgage is the first step every home buyer should do. Pre-approval helps you to determine how much you will be able to borrow and how much your monthly payments will be. This way you know what price range you are looking so 1) you do not waste your time, 2) you avoid disappointment by looking at houses you can’t afford. The lender will also give you a pre-approval letter which is a great tool when we negotiate the price. You have an advantage over other buyers as it means you’re a serious buyer. 3. Lack of Research A lot of buyers are so excited and anxious about their home purchase they forget to do a basic homework. At least, you should make 2 lists: one with “high priority amenities you absolutely need” and second one with “would be nice to have” amenities. For example, 3 bedrooms would be on the 1st list but the hot tub would be on the 2nd one. Also it’s a great idea to do research of the neighbourhoods you are considering: transportation system, amenities, schools etc. Nowadays, all information can be accessed on Internet and not doing so is not an excuse. Knowledge is the power and it will help you to get the best deal possible.
4. Poor Location Location, location, location! Every city, town or rural location has a somewhat different rate of appreciation: even within the same city, different areas appreciate better or worse than others. Is the house on a busy street? You might get blinded by the superb interior of the house, and yet forget that it is on one of the busiest streets in the city. Is it backing onto the shopping mall? If you or your wife love shopping it’s very convenient but will it be harder to sell this house? More likely.
5. Not Considering the Resale "The money you make or the money you lose in real estate happens the day you purchase, not the day you sell!" It’s easy to get excited when shopping for a home and forget about the fact that one day you will sell this property. While touring the home put yourself in the shoes of future sellers. Your knowledgeable REALTOR® should be able to tell you what are the area’s demographics and what are they looking for when buying a home.
6. Buying the Most Expensive Home on the Block If you find your dream home and it’s the most expensive house on the block you could have a problem reselling it. Quite simply, your neighbours' lower home values will dampen yours. Remember, people who buy a $500,000 home usually want to be surrounded by other $500,000 homes, not tiny $100,000 bungalows. But if you absolutely love the house just keep in mind that your goal is to negotiate the lower price so you sell it for a lower price later when time comes.
7. Placing Design Over Function and Necessity Many buyers think that homes were built by professionals, they know what they are doing and many houses have good floor plans. It is essential for buyers to realize that different floor plans have highly different rates of acceptance by the public for highly different reasons. These differences will affect the return rate on your investment – your home. If location is your factor #1, #2 and #3, functional floor plan is #4, #5 and #6.
8. Base the Decision on Exterior Look of the House The house might have an amazing curb appeal, a beautiful backyard or nice stucco. But if it doesn’t suit your lifestyle and your needs do not buy it. You do not live on the lawn, you live inside.
9. Not Getting a Home Inspection Home is one of the biggest investments people make in their lives, so inspecting it for possible problems must be on top of the list. Once you buy a house it’s your house and you own it! It means if there are any defects you own them as well. Even the most experienced homebuyer can’t do the inspection himself due to the lack of knowledge and expertise of the professional home inspector. A knowledgeable REALTOR® will make sure that your offer is subject to a satisfactory home inspection.
10. Waiting and Not Buying at All What are you waiting for, the prices to get better? Perfectly timing the market to buy at the bottom? Approval from your family? If the prices were good enough to be bought last year when they were higher, how can they not be good enough now? Don't be part of the "shoulda, woulda, coulda" group. Decide to move forward, get a qualified REALTOR® who understands the process, get educated, so you can make an informed decision, and then as NIKE says, JUST DO IT!
Being aware of these mistakes together with the help of a knowledgeable REALTOR® you are ready to make an informed decision when buying a home. Call Olena at 778.991.3293 for all your buying needs. |
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