Buying a home is one of the most important — and expensive — financial decisions you’ll ever make. However, most homebuyers are unprepared to make a wise purchase because they know little about the homebuying process.
Luckily, they can avoid making any serious mistakes by learning from the ones others have made in the past. Here are just a few of the most common pitfalls — and how to dodge them — in the search for your dream home.
1. Neglecting Neighborhood Research
Often, homebuyers dedicate so much time and attention to square footage, built-ins, and backyard pools that they forget to consider location. It’s entirely possible to buy a great home in a terrible neighborhood, so do your research.
If you have kids, find out what kinds of schools are in the area. Do you rely on public transportation to get to work? Find out if bus routes are available in that neighborhood.
2. Working Alone
Many homebuyers also make the mistake of working alone in the name of saving money on a broker or realtor. However, they may end up spending more on fees and agents than if they had simply hired a realtor to begin with.
Therefore, unless you have a lot of experience in the real estate industry or know someone who does and can advise you, it’s wiser to shell out the extra cash and get a realtor.
3. Limiting Your Search by Style
Are you dead-set on buying an A-frame? Is your Pinterest feed full of log cabin-style homes? Be careful what you wish for. Limiting your search by a particular style of home is a dangerous game and one that might cause you to pass up great buying opportunities on fantastic houses.
Instead of focusing on exterior aesthetics, try to imagine your favorite style and how it might work with the interior.
4. Ignoring Quality
Crown molding, marble countertops, and farmhouse sinks tend to steal the spotlight these days, leaving many buyers in the dark when it comes to a home’s actual quality.
In other words, they’re so busy drooling over aesthetics that they forget to look for — or completely ignore — red flags like cracked foundations, water damage, and mold growth, which can cost a fortune to fix and may even cause health problems in the household.
5. Making a Lowball Offer
If you notice red flags but are still interested in purchasing the home, you can express your concern and make a lower offer.
However, there’s a fine line between asking for a discount and sending in a lowball offer. Promising an all-cash payment that’s way below the asking price can offend the seller and screw up any chance you had of purchasing the home.
6. Choosing an Inefficient Home
The push towards sustainability has prompted many homebuyers to look for energy-efficient home features. However, high asking prices for homes with solar panels and other renewable energy solutions often scare potential buyers away.
What they don’t realize is that paying a higher price for a more efficient home will save them thousands on energy bills over the next 10, 20, or 30 years.
7. Failing to Explore Mortgage Options
If you’re a first-time homebuyer, there are more mortgage options available than you might realize. For instance, you may be aware of government-insured loans and adjustable-rate mortgages, but a conventional mortgage or Federal Housing Administration loan might be a better option for you.
Therefore, it’s best to do your research and discover all your options before making the best decision for you and your finances.
8. Making a Small Down Payment
Conventional mortgages can have down payments as low as 3%, which can save you from shelling out tens of thousands of dollars right off the bat. However, making the smallest downpayment can increase your mortgage rate, interest expenses, and mortgage insurance premiums.
Therefore, it might be wise to start saving now and put the full 20% down on your dream home.
9. Buying in Desperation
If you’ve been looking for a home for the past few months and still haven’t found one, it can be tempting to give up and buy a house in desperation. However, settling for something reasonable when you could have waited a bit longer might cause deep regret down the road.
If you can stay on that emotional rollercoaster for a few more months, you’ll never have to wonder if you missed a prime opportunity to buy your ideal home.
10. Waiting for “The One”
Home buying is a big decision, and you’ll want to keep an eye out for homebuyer pitfalls that can cause you to spend more than you planned or get a bad deal.
At the same time, you don’t want to hold out hope for the perfect home, because there’s no such thing. Plus, if you pass up dozens of homes in your search for “the one,” you might miss out on perfect opportunities to buy and sell.
So, if you like one enough to seriously consider it, sit with those feelings for a day or two and make a decision.
Making a Confident Decision
The best decision is always a confident one. So if something about a home doesn’t feel quite right, it’s best to move on and continue your search elsewhere. Honor your gut reaction by refusing to purchase a home you’re hesitant about.
And when you do find the right place, you’ll be thankful to have waited and made a firm, confident decision.
Author bio:
Jane is the founder and Editor-in-Chief of Environment.co where she covers topics in sustainability and green building.