When buying your first home it's easy to get caught up in the excitement of it all. This can lead to making mistakes or overlooking certain things. We've broken down the five most common mistakes made by first time home buyers so you can avoid them during your home shopping process.
1. SPENDING TOO MUCH/NOT KNOWING WHAT YOU CAN AFFORD
Often what the bank or mortgage company approve you for is not what you can actually afford. It's important to realize this difference and only pay what you are comfortable with. The best way to go about this is to make a list of all your monthly expenses, except your current rent. Make sure to include everything such as college loans, credit card payments, car expenses, etc. Take this total from your monthly income to see what you can reasonably afford each month. Knowing this before you get pre-approved for a home loan or meet with a realtor will make your life so much easier! Then, once you begin the home search you'll only look for homes in your price range, rather than going above it and ending up wishing for something you can't afford. Worse than that, making the decision to still put an offer on a home that is out of your means and regretting it later on!
If you really end up falling in love with something out of your price range, you may decide to re-evaluate your budget and make some cuts in one area so you can buy your dream home. Either way make sure you know what you can afford first!
2. NOT CONSIDERING ADDITIONAL EXPENSES THAT COME WITH HOME OWNERSHIP
This next one goes hand in hand with the first! Owning a home is different than renting and with that comes different expenses. These need to considered and budgeted into your monthly expenses. With home ownership some of the extra expenses to expect are property taxes, home insurance, repairs/maintenance, lawn care and HOA dues if you live in a neighborhood with an association. Other things to keep in mind are utilities like power, internet, cable, trash removal...things you may not currently be paying for at a rental. It can be a real bummer to get into your first home and then finding it hard to make ends meet.
3. FORGETTING TO THINK ABOUT THE FUTURE
It's easy to only think about what you want right now when searching for a home without considering where life may take you. If you currently don't have kids and fall in love with a one bedroom condo only to decide to start a family shortly after you may regret your initial decision. Take into consideration how your lifestyle may change in the next five years and make sure the home you pick can adapt with these changes. It's also important to think about the future of things around you. Does the home currently back up to open space that could one day become a new condo development? This may change your mind on it. How are the home values for the neighborhood? What about zoning laws? All things to take into account before you take the big step!
4. GIVING NO ROOM FOR COMPROMISE
Of course there are things you have to have when looking for a home. If you know you need at least two bedrooms then don't compromise on that, but if you are set on having a vaulted ceilings, a family room, office area and main floor master you are going to narrow down your options drastically. Make a list of things you know you have to have and then stay open minded from there. Your exact dream home may not be currently on the market or in your price range...being flexible will make the home shopping process more enjoyable. This doesn't mean to settle for any house...just make sure you aren't being overly picky when it comes to everything. Keep in mind that many things can be changed down the road. If you hate the wallpaper in the bathroom, know that you can change it at some point.
5. NOT USING A REAL ESTATE AGENT OR USING THE LISTING AGENT
We are not just saying this because we are a real estate office. Using an agent, especially when buying your first home will make the whole process So. Much. Easier. They are there to help you avoid these and other common mistakes home buyers make. They are available to answer questions throughout the entire home search and right up to closing...mortgage questions, appraisers, inspectors...they have the inside information on all these details. It's easy to think you can just work with the listing agent of a home you find, but this isn't a good idea. Agents have ethical standards to act in both the seller and buyers' best interest, but it's easy to see that this can be tricky for a seller's agent. Make sure to get your own realtor so you have someone looking out solely for your best interest.
CLICK HERE for the full article and to download our First Time Home Buyer's Guide for more tips and advice on the exciting process of buying your first home!!
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