Author Archives: Judy Price

By: Judy Price

Buying a home is likely to be one of the biggest purchases you’ll make in your lifetime. As you move forward with your search for the perfect home, keep some key points in mind to avoid any of the ten biggest home buying mistakes:

1. Failing to set a budget. It is important to take the time to calculate how much you can afford by looking at your monthly expenses and talking with a qualified lender.  Getting pre-approved will save you time as you will know what you can afford and view only the homes that are in your price range.
2. Waiting for the market to “bottom out.” No one can predict precisely when the market will “bottom out.”  Historically low home prices and interest rates make it a buyer’s market out there right now.  If you are financially and emotionally ready to be a homeowner, now is a great time to begin your search for the right home. By buying, you can start building equity, getting tax deductions and enjoying the many other benefits of home ownership.
3. Falling in love at first sight. Even if you love the first home you see, you should compare at least three other homes to be sure that you’re getting the best home for the best price.  Taking the time to compare will help ensure that your chosen home is “the one” and you’ll be less likely to experience buyer’s remorse.
4. Not checking out the neighborhood. The house may be perfect, but if it isn’t situated in a neighborhood you’ll enjoy, you will be unhappy with your choice.  Make sure you choose a neighborhood that suits your lifestyle.  It’s wise to visit the neighborhood a few different times, at different times of day in order to get a feel for the area and make sure it suits you.
5. Making an offer without contingencies. Make sure you have a “back-up plan” in place in your contract. If the home has an irresolvable problem, does not appraise for the purchase price, or if your loan falls through, having contingencies on your contract gives you the ability to cancel the transaction.
6. Glossing over the fine print. You can request copies of many of your closing documents in advance, and you should!  Then, you can have your trusted real estate attorney review the paperwork and discuss it with you so that there are no surprises at closing time.
7. Forgoing a home inspection. Check that house out from top to bottom!  It is critical to hire a professional home inspector who will take the time to inspect the house from top to bottom, inside and out.  The inspector may find minor issues that you can request the seller fix before purchase.  If the inspector finds major problems, you will want to consider the correction costs and, if some cases, reconsider the purchase.
8. Hiring the wrong agent. Identifying an agent who is knowledgeable, communicates clearly and understands your needs is essential to the home buying process.  Make sure that your agent is very familiar with your area of interest and the price range you’re looking for.
9. Thinking short-term. You may adore the home now, but will you love it in five years?  It’s wise to think about the future and envision what you will want and need down the road.  Also, think about how the home might sell in the future – what is its likely re-sale value?
10. Forgetting closing costs. Closing costs can run from 2 to 5 percent of the home’s purchase price.  To avoid an unpleasant surprise on closing day, do not forget to include these costs in your calculations for the purchase of your home.

Keeping these ten mistakes in mind during your search will help you to buy with confidence.

It might feel strange to be concerned about resale value on a home that you don’t even own yet, but it is an important component to take into consideration when searching for your next house.  More likely than not, you will eventually move from the home and, at that time, it will need it to be a home that you can sell rather easily.

The basic considerations for home resale value are location, prospective buyer motivation and home features.

1. Location: While desirable locations do not remain that way forever, they do serve as a good model.  Ask yourself: Why are the sought-after neighborhoods in demand and how long have they been top choices?  Are there other areas in town that are increasing in desirability? Is the neighborhood attracting development or is it stagnant? How do the schools in the area rank?  Good local schools raise the value of the property.
2. Prospective Buyer Motivation: Analyzing your prospective buyers and their wants and needs is always a wise idea.  Look through local real estate advertisements and identify the features that are highlighted on homes that are selling. Are the advertisements written to attract senior citizens or young professionals and families?  Taking the time to understand potential buyers and their motivations will help you better spot homes with high resale potential.
3. Home Features: It’s all about the features!  If the prospective home has some outdated features, but they are easy fixes (such as old paint or older fixtures), those items should not be a huge concern.  If the home has outdated features that are difficult to change, such as dated tubs and showers, it may be of greater concern. Take a close look at the home and make note of the simple solutions and the costly ones, then decide how much you should invest.

Next, you should understand which home features traditionally add value. Multiple bathrooms are always a plus, spacious cabinets and closets are desirable and everyone enjoys natural light!  Other desirable features depend on your prospective buyer’s motivations.  For example, if you will most likely resell to senior citizens, you may want to consider a one-level home.  If you are going to be selling to families, the number of bedrooms and bathrooms will be very important.

While your first objective is to find the right home for you, taking resale value into consideration will provide you with added flexibility and funds down the road.