When I work with a client to downsize a home, I also get to meet couples who are looking to buy their very first home. After years of working within the real estate industry, there are a lot of things that I have heard and seen that are just not true within my industry. One of the biggest misconceptions when buying one’s first home, at least from my perspective, is that buying any type of real estate will always turn a profit. This is not so. Everything depends on the deal and the specific buyer’s circumstance, which leads me to the topic of this blog- first time home buyer mistakes!
There are three major mistakes I see a lot of first time home buyers make,which are as follows:
1. Biting off more than they can chew. What the bank says you can afford and what you know you can afford or are comfortable with paying are not necessarily the same amount. The bank looks at paper and numbers, they don’t factor into your lifestyle- which is a very different set of numbers from what the bank sees. And when you go to look at a home, don’t look at something outside of what the bank says you can afford. In fact, I would look at 10 to 15 percent below the bank’s number to give yourself some room for emergency and annual expenses.
2. Being too picky. The first time home is not going to ever be perfect. You will have to sacrifice a few things along the way, like yard space or kitchen upgrades. Think of buying your first home as your first car. Most of us didn’t get the car we desired, our dream car, as our first car out of the gate. Finding a good deal, something we can afford, and something we can resell later in life to trade up is the focus when buying the first home- not custom kitchen cabinets or the latest trend in bathroom sinks.
3. Passing up the inspection for a good, quick deal. If it sounds too good to be true, it usually is! I have seen first time home buyers make mistakes because of pressure. They feel a home is priced so good that it will be swept up quickly and that a home inspection will slow down the process for them and that they may miss a deal. WRONG. A home inspection should always be done, regardless of what you are being told about the house.
Other helpful questions you should ask when buying a home for the first time should be along the following lines;
Is your street a popular rush-hour shortcut?
What are the zoning laws in the area should a neighbor decided to do a little construction?
If there is a lot of undeveloped land? What is likely to get built there?