I often write about the positive aspects of home purchasing and home ownership, but not every contract situation turns out how we would like. As the real estate agent, it is my job to help my clients rise above these emotional pitfalls, and even out the process. Purchasing a home is often the biggest expenditure in my clients’ entire lives. This decision needs to be a smart investment, and not an emotionally driven purchase! Here are 5 things to be cautious of:
- Falling in love with a home. I can’t tell you how many times my clients have started to swoon over a particular property too early in the process. They begin to imagine furniture filling the space, and the children rush to claim bedrooms. But an early emotional attachment is trouble down the road. It often creates a rush and need to put in an offer that overlooks critical inspection related items. Also, it can result in clients being willing to overpay or bid up a property beyond realistic market value. I recommend that buyers always look around at more homes even if they decide they like a particular one. At least 5, preferably 10. Take the time in the beginning, it’s worth it.
- Overpaying for the perfect home. The perfect home may be perfect for you, but other buyers down the road may not think so. You should always consider resale value for your investments. Even if you plan on holding on to the home forever, you can never completely plan for what the future brings. Be careful not to overpay for a home you think is perfect.
- Having unrealistic expectations of “stealing” a home. Many homebuyers will begin the process looking around for homes in a very low price range because they want to “keep their payments low.” They want me to show them properties that consist of a “shack” on vacant land in the middle of nowhere, or that irresistible “fixer upper” that needs $80,000 in work. What they don’t realize, is that with a bank loan, you wrap up all of your home expenses in one package. If you are able to get a loan on a “fixer upper” then you are often left with the prospect of major repairs and remodels out of pocket and are not prepared for sudden expenditures like a new furnace or roof repair.
- Lowballing. (Related to number 3) Everyone expects to negotiate, but having an unrealistic concept of market value will result in offending the seller and lead to contract issues down the road. An educated buyer will already have a market analysis completed for them on a property before putting in an offer. They should know what other homes that are similar in the area have sold for, and what the competition is like.
- The grass is always greener. No one can predict the future, but if you wait too long to pull the trigger on a home, you just continue the cycle of renting and re-renting, paying your Landlords mortgage and securing their financial future instead of your own. The perfect home may be difficult to find, but often it takes vision to see through the muck and find a gem. Constantly waiting and hesitating to make a decision because you fear that it will be the wrong decision may be the wrong decision itself.
So while searching for a home, keep these pitfalls in mind and work closely with your Realtor to set realistic goals and expectations for yourself. Good luck in your home hunting!