Are you ready to buy your first home? There’s a lot more to the process than you might think, so make sure you avoid these common mistakes home buyers often make.
Recent research has shown that first-time home buyers make up about 65 percent of all home buyers. Even though it’s such an exciting experience, buying a home for the first time is not as straightforward as it sounds. From the house-hunting hassle to the numerous costs that can wipe your account before you even pocket the keys, buying your first home house can be overwhelming.
With all the daunting processes involved, first-time home buyers can easily end up making some costly mistakes whose ripple effects may cause even more problems.
Here are some of the common pitfalls and how to avoid them when buying your first home:
#1 – Blowing the Budget
As a new home-owner, it’s understandable you want the best home the market can offer. However, this doesn’t mean you have to break the bank to get the best deal.
Even if you can get the bank to finance your new house, you’ll probably be burdening yourself with a huge debt. This is why it’s important to have a solid budget when shopping for your new home.
If you want the house financed, be sure to consult a mortgage broker to help you get pre-approved for a mortgage that falls within your borrowing power.
#2 – Underestimating the Costs
There are so many costs involved when buying a home that you can easily forget to budget for some essential things. In most cases, home buyers account only for the down-payment, closing costs, and acquisition costs; forgetting other crucial costs that may not be covered by the mortgage.
However, you’ll also need to account for moving costs, home inspection, mortgage costs, utility costs, as well as costs for unforeseen renovations. Also, be sure to work with a mortgage broker to help you know more about other costs such as taxes and insurance that are associated with owning a home.
#3 – Not Applying For A Mortgage First
Many first-time home buyers are quick to go house shopping without ever meeting with a mortgage professional. This can put you at a disadvantage when the house you want comes available and you don’t know if you can qualify for a mortgage on it.
A good mortgage professional can identify and diagnose potential roadblocks you may encounter in the home buying and mortgage approval process. They will recommend the best mortgage options available to you.
#4 – Buying After One Visit
When buying a home for the first time it’s important to remember that once you firm up on your offer to purchase, you are committed to buying that house. So, unless you’re planning on reselling the house after a couple of years, you are also committing to that neighborhood.
Therefore, before agreeing to buy the house, make sure you’re contented with it and the surrounding neighborhood. This is in terms of security and proximity to social amenities like shopping, hospitals and schools. You also don’t want to be driving for long hours just to get to your workplace.
Thus, after the first visit to the property, schedule another one a few days later. Drive through the neighborhood during the weekends when most residents are around and decide whether it’s a good fit for you and your family.
#5 – Involving Emotions
While finding a good home and falling in love with it instantly isn’t a bad thing, it can cloud your judgment.
For instance, some first-time home buyers may be inclined to buying a home in a particular city or neighborhood and not any other place. However, due to their attachment to that specific neighborhood, they may be limiting their search for a better home.
Similarly, you may feel too attached to a particular house in a specific neighborhood that you end up overpaying for the home. To avoid this, make sure you find a reliable agent to help you get the best deal without involving emotions.
What to Consider When Buying Your First Home
Now that you already know some of the common mistakes first-time home buyers make, let’s delve into what to consider when buying a house. This will not only help you get the best deal but also refine your search.
Your new home should offer you more room for growth. As such, it needs to be aligned to your current lifestyle habits as well as your future plans.
If you’re buying a house in an effort to have more room for your family or just for the freedom of it, an ideal house should address these needs.
Check Out the Land Beforehand
As much as your interest is on the house, the land on which it’s located on should also be a top concern.
Examine the land and the area around it to look for potential problems such as flooding or even pests. Also, ensure the land is used well as stipulated by the local government. Some real estate investors may acquire land reserved for commercial buildings and use it for residential purposes.
Any Renovations Needed
On your initial visit to the property, pay attention to leaky faucets and other damaged areas that may require renovations. Agreeing to pay the purchase price without having the damages fixed by the seller can cost more money out of your pocket.
Having a home inspection done, may identify issues with the home and give you a better idea of maintenance issues that need to be addressed now and in the future.
Buying Your First Home Has Never Been This Easy
Buying a home is no easy task for both experienced and first-time home buyers. But, with the above tips and expert advice, you no longer have to dread the nerve-racking process of buying your first home.
Are you in the market for a new home? Check out why you may need a mortgage broker.