Okay, so you’ve saving your hard earned cash for a while, driving through the locale that you’re interested in, and doing your research on the internet. You decide you’ve found the property that you want to become your first home.
It can be an exciting, stressful and daunting process all rolled into one.
So, we’ve collated some common mistakes that first-time home buyers often so that, hopefully you can avoid them and make the process and positive as possible.
Mistake 1. Not being pre-approved for a mortgage
First-time home buyers sometimes mistake pre-approval by a mortgage lender with pre-qualification. Pre-qualification is the important first step. It will give you a great understanding of what you can realistically afford to buy. Pre-approval means that your have a written commitment from the mortgage lender for a maximum mortgage at a stated interest rate.
Mistake 2. Waiting for the perfect home
Many first-time home buyers make the mistake of searching for their perfect home – the home that will meet every single one of their needs, wants and desires.
Such buyers frequently pass up great homes that would meet 90% of their requirements and eventually give up and purchase a home they do not really want because they are worn out, or circumstances overtake them. Also, while waiting for the “perfect” home, market prices continue to rise which means you will have to pay more for a home. Determining your most important criteria will help you select a home that meets the majority of them. In other words, know the difference between your needs and your wants.
Mistake 3. Missing the home building and/or pest inspection
Either in an effort to save some money or because they are wrapped up in a multiple offer situation, first-time home buyers sometimes decide to skip having a professional inspect the home. Using competent inspectors can offer you peace of mind that you are making a sound choice or alert you to underlying problems that could cost you a lot of money.
If you know the home you are interested in is going to have multiple offers you can always do the home inspection before you present your offer. Having a home inspection under your belt will help you enter the negotiations with your eyes wide open and the advantage of having one less condition. This is not uncommon and most agents/brokers will happily accommodate this.
It is better to spend a couple of hundred dollars to get the inspections given the total cost you will potentially outlay.
Mistake 4. Over-buying
A large or beautiful home with little or no furniture is a very uncomfortable reality. When you spend all your earnings to support your house, it can quickly cause family stress. As mundane as it may sound “buy within your means” taking into account unforeseen circumstances (eg. Interest rate rises, unexpected costs etc).
Mistake 5. First-impressions
First impressions can be a very strong influential factor when searching for a home. First-time home buyers should remember to keep an open mind and to try to be as objective as possible when examining a home. Don’t allow the current style or look of the house, whether good or bad, to overly impact your decision. A messy or “ugly” house may be structurally sound and actually suit your needs. Don’t look at the interior, whether it be design or furnishings, and not see past this. These issues are cosmetic and easily changed to suit your requirements.
Alternatively, don’t rush to make an offer just because a home is beautifully decorated. A thorough investigation of the house will help you make a sound decision.
Embarking on the quest for your first home is exciting. But remember, do your homework before you begin and be careful to avoid mistakes that could prove costly. Be as objective as possible and your purchase will no doubt prove to be a sensible one.