Buying your very first home is a big deal. Chances are, this is your biggest purchase to date, which is nothing to take lightly. It’s a good idea to seek guidance from an experienced agent who will help you navigate through the murky waters of the real estate market, financial process, and making that big purchase.
Going at it alone is just too overwhelming. A simple search of the “Dos and Don’ts” or “Must-Dos of Home Buying” will bring up thousands of articles, blogs, and advice pieces that offer conflicting ideas, aren’t specific to your current market, or are just plain wrong.
However, with over 28 years of experience in the real estate business, I know when homebuyers are educated when they begin the process, they have a better experience searching, financing and buying a house to call home.
Below, I have included the five biggest mistakes that first-time homebuyers should avoid. After looking through the deadly sins of home buying, seek my professional help and get started today!
Failure to Understand What You Can Afford
Due to the lack of experience, many first-time buyers don’t fully understand the entire expenses and costs that go into purchasing a home. Many just consider the mortgage payment. They create a number that they can afford and base their selections off of that. However, there are many more expenses to consider than just the mortgage.
Insurance, property taxes, homeowners’ association fees, along with higher repair costs or other fees all go into the cost of the home. This is why it is so vital to create a budget before you start shopping around. That way, you won’t set your hopes on a home that is out of your price range.
Sit down and make a list of all your monthly and annual costs. Once you have that number, subtract it from the amount you bring home each month. This will show you what you can (and cannot) afford.
Skipping Mortgage Qualification
Speaking of mortgages, while you might not think it’s mandatory to get pre-approved for loans, what you believe you can afford and the loan amount you’re granted can be two very different numbers.
Plus, while they aren’t exactly mandatory many sellers require pre-approval letters. In fact, the vast majority of sellers will not accept an offer without a guarantee the buyer is able to afford the home. This is especially true for in situations where there are multiple offers.
Failure to Complete a Home Inspection
Have you found a great home and put in an offer? Congratulations! But you’re not done yet. Home inspections are strongly recommended. While the buyer does have to cover the cost of the inspection, it’s well worth and can prevent you from spending a large amount of money in the future.
You don’t want to end up moving in and spending all of your time making (and paying for) unexpected repairs. Nor do you want to purchase a house that has so many repairs it’s more of a money pit than a home. Always be sure you hire an inspector to look over the home before making any final decisions.
Acting on Emotions
It’s extremely easy to get caught up in the emotions of buying a home, especially when it’s your first home. However, don’t get too emotionally involved until you have the keys in your hand. Your excitement can lead you to believe you found your “dream home” while overlooking major points.
If you fall in love with a home, be sure to go back many times, leaving your emotions at the door. Get an inspection. Look over everything from the price to the interior/exterior with a fine-tooth comb. Ask your friends and family for opinions. Check out the neighborhood. A house is a long-term investment, and you want to be sure of everything before making a final decision.
Placing Too Much Faith in Online Numbers
In today’s time of doing everything from shopping, dating, attending school, and even working online, it’s easy to get used to trusting sources you find online. However, what first-time home buyers should always remember is that online home values and mortgage rates are a good place to start, but you don’t want to put too much faith in them.
Loans and mortgage rates are complicated, so it’s easy to get confused or overlook something online. While you might want to check to get a general idea of what to expect, it’s best you always proceed in person.
Same goes for looking at houses and neighborhoods. Searching online can give you a generic idea; however, many times these online real estate agents have false home values. Sites such as Trulia and Zillow pull the date from our FMLS, which often leads to delays. So, houses that appear available are already sold.
Plus, the numbers mislead sellers as they try to price the homes themselves. It’s also worth noting that many times the data is particularly inaccurate in older neighborhoods, where the houses have varying sizes and amounts of updating.
Again, this is where an experienced agent comes in. Once you narrow down a neighborhood or a part of town, the agent will be able to give you correct information live from our FMLS.