Mistakes to avoid when buying a home
The process of buying a new home can be incredibly exciting, yet stressful, all at once. After all your saving; weighing your options, and casually looking around, now you have finally decided that you are ready to buy a house.
Where do you start?
Use the following list as a guide to help you avoid the most common mistakes and when you are ready call upon one of our professional They will guide you every step of the way and assist making your home buying experience a positive one.
1. Searching for houses without getting pre-approved by a lender: Do not mistake pre-approval by a lender with pre-qualification. Pre-qualification is the first step toward being pre-approved. It will point you in the right direction and give you an idea of the price range of houses you can comfortably afford. Pre-approval, however, means you become a cash buyer, making negotiations with the seller much easier.
2. Allowing “first impressions” to overly influence your decision: The first impression of a home has been cited as the single most influential factor guiding many purchasers’ choice to buy. Make a conscious decision beforehand to examine a home as objectively as you can. The current owners’ style or lifestyle should not sway your judgment. Beneath the bad décor or messy rooms you may discover a home that actually suits your needs and offers you a structurally sound base with which to work. Likewise make sure you thoroughly investigate the structure beneath the paint, even if it is your favourite colour, before you come to make your decisions.
3. Failing to have the home inspected before you buy: Buying a home is a major financial decision that is often made after having spent very little time on the property itself. A home inspection performed by a competent company will help you enter the negotiation process with eyes wide open, offering you added reassurance that the choice you are making is a sound one, or alerting you to underlying problems that could cost you significant money in both the short and long-run. Your REALTOR® can suggest reputable home inspection companies for you to consider, make arrangements to have it done and ensure the appropriate clause is entered into your contract.
4. Make it a priority to know your rights and obligations inside and out. A lack of understanding about your obligations may, cause friction between yourself and the people with whom you are about to enter the contract. Wrong assumptions, or poorly written/ incomprehensible/ missing clauses, or a lack of awareness of how the clauses apply to the purchase, could also contribute to increased costs. These problems may even lead to a void contract. Take the time to go through the contract making use of the resources and knowledge offered by your REALTOR® and lawyer. With their assistance, ensure you thoroughly understand every component of the contract, and are able to fulfill your contractual obligations.
5. Ask your REALTOR® for a current Comparative Market Analysis. This will provide you with the information necessary to gauge the market value of a home, and will help you avoid over-paying. The seller receives a Comparative Market Analysis before deciding upon an asking price so make sure you have all the same information at your fingertips.
A CMA will include:
What have other similar homes sold for in the area?
How long were they on the market? What the difference is between the asking and selling prices?
Is the home you’re looking at under-priced, over-priced, or fair value?
6. Failing to familiarize yourself with the neighbourhood before buying: Check out the neighbourhood you’re considering, and ask around:
What amenities does the area have to offer?
Are there schools, churches, parks, or grocery stores within reach.
Consider visiting schools in the area if you have children. How will you be affected by a new commute to work?
Are there infrastructure projects in development?
All of these factors will influence the way you experience your new home, so ensure you’re well acquainted with the surrounding area before purchasing.
7. Insurance. If you wait until the last minute, you’ll be rushed to find an insurance policy that’s the ideal fit for you. Make sure you give yourself enough time to shop around in order to get the best coverage to suit your needs.
8. Not recognizing different styles and strategies of negotiation: Many buyers think that the way to negotiate their way to a fair price is by offering low. In reality this strategy may actually result in the seller becoming more inflexible, polarizing negotiations. Employ the knowledge and skills of an experienced realtor. They will know what strategies of negotiation will prove most effective for your particular situation.