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The Top 10 Mistakes Made in the Home Buying Process.

Reblogger
Real Estate Broker/Owner with Lake to Lake Realty LLC

No matter if you are buying in San Diego, New York, or Kenosha, Wisconsin, the list below is well worth reading.  Finding a good Realtor is the most important step in buying a home.   This can save you time and money and of course if you believe "time is money"  that is a double savings!

Original content by William Johnson

The Top 10 Mistakes Made in the Home Buying Process - And it's Not Always the Buyers Making the Mistake.

This post was inspired by Bob Stewart. 

We all have made mistakes in the way we first go about fulfilling the desire for owning our own home. ( notice  I didn't say the Dream of Home Ownership - taking care of what you purchased is not exactly my definition of a dream). I have read so many lists on this subject, I thought I would formulate my own that are a bit more reality based and not the typical response to the question. Especially in who may be making the mistake.

1. The first mistake in my view is confusing price with value. Price is a term we mostly understand. It is what it costs. Sometimes it is even negotiable. Value is a whole other issue that needs to be explored. The right home in the right location, at the right price that can be maintained and even improved is probably a good value. An example. A young newly married couple. It's a first time ownership question. Should I buy a home that is large enough to account for a future family or buy something more modest that suits the needs in the shorter term. That should be answered individually. There should not be a stock answer to this question, the answer is different for every buyer. Their needs, their plans and their reality. Value is better defined as getting the right property that satisfies the right needs at the right time. The right floor plan in the right neighborhood in the right condition is a good start. 

2. Way too much time spent looking for real estate before the professional REALTOR® is selected that will help the Buyer through the journey of financing and exposing the right property for the needs. To my way of thinking, a home out of context to the neighborhood it is in is just a house on a street. I think it is far more useful to engage a professional from day one when the decision is made to buy a home. A good REALTOR will save so much time in understanding the nuances of the housing market and where the best choices are located for the needs and wants that are the Buyer's priorities including price vrs value.

3. 1st time and even second time Buyers often use the word fixer when what they mean to say is that "we can do the re-painting" and maybe change some of the flooring". If a Buyer says they would buy a fixer, their agent needs to ask what they mean by " Fixer" and not assume that the Buyer can handle more than a bit of easy cosmetic fixing up or decorating. I think agents who tell the Buyers that "oh that is easily fixed or this would be easy to change" is full of hot air and don't either own their home or don't take care of it anyway. How easy it is fix or repair depends on the ability of the person to actually understand the issue or at least how to do it or can afford to hire someone who does know how. Way to often these assumptions are not based in the Buyer's reality but simply pacified by the person that wants the buyer to get on with it. 

4.  If a real estate professional is not willing to spend the time teaching a new buyer the ins and outs of buying as well as understanding the true cost of ownership and where they learned their current opinions and help reshape them correctly if wrong, is not building a long term client. It is necessary to spend as much time as we need to counsel the buyer in the ways of the market and how to navigate through the learning process that is unfolding before their eyes. I think of it as the "BOM" of Real Estate. Buying, Owning and Maintaining. My Buyers, when they become Sellers do very well in the resale market because they were prepared for it from day one. Odd as it may sound, my past buyers are my best Sellers. And Vice Versa. 

5. The amount of home a Buyer can qualify for is most often not related to what the Buyer can actually afford. Lenders make loans and we have seen the consequences of Buyers being facilitated to purchasing homes they may be able to buy but can't easily afford to own or maintain. Taking buyers to the threshold of maximum price they can qualify for can lead to some serious consequences down the road. And that is not always related to missing or making late payments. It often revolves around the true cost of ownership and maintenance and not just the payment on the mortgage. A home not properly and constantly maintained and improved is a home losing value while the costs associated for the paying of it, keep increasing. That often leads to a losing proposition.

Perhaps Mistakes 6 through 10 should be not clearly understanding and mastering 1 through 5.

 

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San Diego Real Estate | William JohnsonCertified Residential Speacialist

William Johnson, Certified Residential Specialist 

 
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Comments (1)

William Johnson
Retired - La Jolla, CA
Retired

Hi Sheila, 

Thank you so much for the re-blog. So glad you liked it. I saw a great post of yours and I am going back to there to comment. I will also add that I hope you will also write many more of your own posts. You write quite well and have a lot of passion and a lot of smarts. Looking forwarding to more.

Jan 18, 2011 03:09 PM