Before making the decision to purchase their first home, buyers often neglect to ask themselves some important questions, which results in them making some mistakes which can be avoided. Here are some of the most common mistakes first time homebuyers make that can be avoided:
Not finding the right real estate agent: every first time home buyer should work with a real estate agent that will work with you to find the right home that will fit your needs. You want to work with an agent you can trust and feel comfortable talking to. You need to be able to voice important concerns to them.
Following a real estate agents advice without thinking: a good real estate agent can be the first time homebuyer’s best friend when going and looking at potential houses, but you need to think for yourself. Take their advice and listen to what they have to say but also listen to what your head is telling you. Something that may not seem a big deal to your real estate agent may be a big deal to you. Your real estate agent should be able to give you informed advice about the current housing market, current trends, and assist you with negotiating a fair deal while keeping your needs and wants in mind in order to find the right option for you.
Not taking resale into account: you’re just buying your first house. Why even think about selling? It’s always a good idea to plan ahead for the future, especially when you’re making a life changing decision such as buying a home. Families change over time. There may be new additions and you may decide to move into a bigger home. Children grow up and move away which may leave you with more room than you need so you may want to look for a smaller home. You may get a job in another city, province or country and be forced to move. If you consider the resale value of your home as you’re buying it, you’ll be saving yourself a lot of stress down the road if you decide to sell.
Trusting verbal agreements: verbal agreements between honest people can work. The problem is that it can be really hard to tell if the person you’re making the agreement with is honest or not. They might promise you something, shake on it with you, only later to tell you that no agreement was made. Without evidence of the agreement, you will find yourself with little recourse. If you want something and the seller agrees to give it to you, make sure you get it in writing.
Foregoing a home inspection: this is a common mistake that many first time homeowners make, foregoing a home inspection. The home inspection is important and it is important to the person you hire to inspect your home knows what they’re doing. All potential issues with the home should be disclosed to the potential homeowners by the current homeowners, but in many instances they are not. Make sure you get someone into your house to look it over that knows what he or she’re doing before you close on the house. If there are any major repairs, you may be able to get the current homeowners to cover them or knock the estimate for the repairs off the purchase price.
Not anticipating all the costs associated with buying a house: when you buy a house, there are a lot of fees involved and they can add up pretty quickly. Some of the fees you may have to cover include: an appraisal fee, credit report fee, property taxes, homeowners insurance fees, notary fee, loan application fee, loan application fee, escrow fee, inspection fee, and moving costs. There are credits you can get to cover some of these fees and you will not apply for all these fees, it depends on what lender you work with, the agreement you work out with the current homeowners.
Buying in unfavourable market conditions: the housing market can be a little complicated. Making matters even more complicated is the fact that the housing market is always changing. It’s better for buyers to look at houses when the market favours buyers. It all depends on supply and demand. If there aren’t many houses up for sale but a lot of people looking for houses, the housing market is going to favour sellers. They’ll be able to sell their property at a higher price than they would in a buyer’s market. You really want to try to hold off until there are more houses for sale and less people are buying. You’ll get a better price on your home because more buyers will be looking for available houses that will fit their needs, buy you’ll need to make your home as appealing as possible in order for it to sell. This often means doing upgrades to the home and lowering the price, making it the ideal time for you to buy. Do a little research into the market in your area. If you aren’t sure what to do with the information you find, talk to your real estate agent to help you make sense of the information.
Spending beyond your means: buying a home is not like renting. You will have a monthly payment to make like you would if you were renting but you also have new expenses to worry about. Maintenance and repairs are your responsibility when you own a home. Figure out your monthly expenses making sure to include everything you spend money over the course of a month. Homeowners have a lot of expenses that need to be planned for. Create a budget before you start looking for a house so you know what you can and cannot afford.
CENTURY 21 Miller Real Estate Ltd.
Brokerage Independently Owned and Operated
#4 Office in Canada
By Production CENTURY 21 Canada 2013
467 Speers Road,
Oakville, ON L6K 3S4