You’ve decided it’s time to break out of rental life and make a big purchase: your first house. You and your family are ready to put down permanent roots and get to work making a house a home. It’s an exciting time, but it’s important not to be careful during the process. There are several pitfalls and traps first-time home buyers can fall into. Be aware of these and you’ll be mowing the lawn of your new house in no time.
House-Hunting Mistake #1: Not Knowing Your Budget
One major mistake first-time buyers can make is not budgeting correctly. It can be easy to get sucked into looking at places that are out of your price range and committing to something you can’t afford. According to The New York Times and the National Association of Realtors, the national median home price in 2019 was around $280,000 which required an annual income of over $61,000. Be sure to figure out how much you’re willing and able to spend before you accidentally fall in love with a place that could break into your retirement account.
House-Hunting Mistake #2: Not Getting Pre-Approved
In that same vein, not seeking a pre-approved home mortgage can get people into trouble. Be sure to check with the bank and see how much they’re willing to lend you before making a down payment. You don’t want to get to signing and realize you don’t have the loan you need and wind up losing a house you love.
House-Hunting Mistake #3: Romanticizing The Options
It’s easy to get caught up in the excitement of buying a house and have your expectations too high. Be careful and try to be realistic when looking at houses. You’ll want to be able to distinguish between a “fixer-upper” and a lost cause. Don’t overestimate your ability to spruce a place up and get stuck with a crumbling home, but don’t be too wary of a few minor cosmetic updates and upgrades either.
It’s also important to shop around. Look at all your options before making a hasty decision.
House-Hunting Mistake #4: Getting The Timing Wrong
Making hasty decisions is another mistake first-time house hunters can make. As with may other aspects of life, timing is everything when it comes to home buying. You don’t want to make an over-eager offer and wind up less than satisfied. You may need to sleep on your decision before finalizing it. Make sure you’re comfortable with the house, the neighborhood its in and the cost before jumping in with both feet.
Conversely, you don’t want to wait too long either and miss an opportunity.
House-Hunting Mistake #5: Doing It Alone
Fortunately, many of these mistakes can be avoided by avoiding the final mistake in this list: DIY home buying. You may think you have the knowledge you need to do things alone, but doesn’t hurt to consult the professionals, especially when making a large investment, like a house. Working with a real estate agent, mortgage broker and real estate attorney can prevent major mistakes that can lead to major issues down the road. Surrounding yourself with the right people is a good idea.
Buying your first home is exciting. The first step in a new path of a new chapter. But preparation is key, and avoiding these mistakes can help you start life in your new home on the right foot.