There is a certain thrill when it comes to buying a house. For many first time buyers, they are often too excited in doing so that they make a number of costly mistakes. From accepting verbal promises to purchasing the house right away without looking around, these actions can turn into a financial burden in your future.
photo credit: porschelinn via photopin cc
Make sure to avoid the following mistakes below when buying a home:
Purchasing the house without thoroughly inspecting it
This is not a common mistake most people make as it is often part of the legal process of settlement. However, there are still some buyers who take the word of the realtor without inspecting the house. Always insist in thoroughly inspecting a potential house and land packages when offered.
You can take full advantage of this by hiring a professional inspector. Have them fully inspect the foundation, plumbing, electrical wiring and air conditioning system within the house. Doing so can help you avoid the cost of repairs to your property in the future and ensure settlement runs smoothly.
Signing up for a loan without a planned budget
Another common pitfall many homeowners experience is the unaffordable monthly mortgage repayment. This usually happens when they accept a home loan without formulating a budget. They simply assume their take home pay will be sufficient enough to cover the monthly expenses. However, they may not take into account of any changes to their job or increase/decrease in expenses.
Planning your budget requires an extensive review of your take home pay and monthly expenses. This can give you a clear insight on what you can do to cut down on your expenditures. Once you have a clear idea of how much you can cover for the monthly mortgage, speculate on other future expenses you might need to pay. This includes weddings, tuition fees, a car loan and much more. Once you have noted down all your expenses, it is easier to see how to go about paying the necessities.
Foregoing in hiring an agent
Many first time buyers believe the process of purchasing a home is as simple as going shopping. However, there are numerous financial decisions you need to make before you can close a deal with a seller. A realtor can assist you with this instead.
Your agent’s task isn’t just to find a house which fits your budget. They can determine which house within the market provides more value to you than the others. Having them can increase your chance of closing a deal in your favour.
Picking an unqualified real estate agent
Hiring any agent without checking their credentials or experience can be a costly mistake for any home buyer. Picking the wrong one can result in paying more than what you can potentially get for a certain property. Here are ways you can ensure you hire a qualified real estate agent:
Inquire about any nearby properties for sale – Competent agents are always aware of the local property market. They can give information regarding some of the houses on sale within the area. If they are able to provide the details of a property for sale in Ipswich, Brisbane or Adavale, place them at the top of your list of likely agents to hire.
Check how long they have been in business – An ideal agent should have at least 5 years of experience.
Ask for feedback from their previous clients – Previous clients can provide unbiased feedback on a particular realtor they hired.
Look for a certified residential specialist (CRS) – There are numerous types available in the market and certain realtors are more focused on a specific category. As a home buyer, the one you are looking for is a CRS agent. They are required to complete residential real estate training. This makes them more knowledgeable in finding a house which fits your interests.
Getting attached to a single house
Placing any sentiments on a house can put you at a disadvantage. It places you in a mindset where you need to obtain the house by any means necessary. This includes closing the deal at a higher price or ignoring any structural damages. If the seller sees your attachment to the house, they can be more aggressive in taking the advantage and negotiating a deal.
When looking for a house, treat it as if you are also looking for a new friend. Like a friend you want to keep, your house needs to be reliable and something you can be comfortable with. Keep a neutral stance when you are given the details of the property. Look past the pros and focus on cons.
Follow the guide above to avoid the pitfalls other home buyers have experienced. Make sure to pick a property within a stable and secure community. Houses and land within these areas are always a good investment.
About the Author: Barbara Verner is a business and finance freelance writer residing in Adelaide, Australia, and writing on behalf of Providence Ripley.