The idea of owning a home (your own personal living space) is exciting. But the process of realizing it – in actuality – definitely presents a daunting prospect; especially for individuals buying a home for the first time.
First-time home owners, due to the very ‘beginner’s’ nature of their ownership endeavour, are bound to experience confusion and difficulties as they venture into the property market. And this mental consternation often leads to them committing a variety of characteristic mistakes – which many buyers later regret as they end up with poorly-orchestrated house deals.
A Dream Come True…
For many people, their personal home space figures as a dream that has been awaiting its concrete manifestation for a long time. Therefore, when they are finally ready to buy one, it is understandable if they become a bit hasty in making their decision as soon as they see an ownership opportunity first present itself.If you’re a first-time buyer, however, it is imperative to keep in mind that a home purchase comprises a long-term investment and that your invested money should not go to waste. In fact, when the time comes, it should offer good returns on your investment.
Now, this last part is only possible when you make smart buying decisions following a lot of detailed planning. For starters, you first need to become cognizant of some of the common types of mistakes that you could be susceptible to.
This blog discusses four of the more prominent ones that you should definitely avoid as a first-time home buyer (and which many people, unfortunately, seem to lose sight of). Furthermore, it provides tips to facilitate you through the process – in order to ensure its smooth progression.
Online real estate platforms (and their ‘Forum’ features, in particular) frequently bear lengthy discussions regarding the subject of first-time home buying mistakes – seeing as these are quite common occurrences.
4 Major Mistakes to Avoid as a First-time Home Owner
ply question those of your family or friends who have already bought their first home, and most of them will tell you they could have made a better decision.If you’re planning on buying your first home in the near future, however, you’re largely in the clear. This is because you still have time for streamlining your plans and avoiding mistakes.
Here are four major errors to look out for:
Conducting Inadequate Research
As mentioned above, first-time home owners can show a bit (or a lot of) haste in trying to gain a thorough understanding of the market and selecting a home. This unnaturally ‘quickened’ orientation leads to the accrual of many omissions of research; all of which can obviously cause prospective buyers to miss out on more economically feasible purchasing opportunities.Apart from knowing your own budget, you should be aware of all the home financing options at your disposal (mortgage, home loans, etc.). Once you know the exact amount of funds that you can procure (including the down payment figure which is required to be paid upfront), you should shortlist all your available housing options accordingly.
Your research should go deeper than just the finances or an assessment of the house construction itself. For example, you should be aware of the market’s current condition. Additionally, a broad understanding regarding your property’s location is important; as it allows you to ascertain the type of people who would be living near you, as well as the amenities available in your vicinity. Also, you need to consider that if you are seeking to live within a large suburban community, then not all areas within it will provide equal residential benefits.
In summation, you should conduct as much local research as possible. Nowadays, people have easier recourse to all kinds of real estate information thanks to the internet. Still, it’s better to go out into the field and talk to property agents, real estate experts, and other market stakeholders yourselves; to gain a more eclectic idea of what you’re in for.
Giving in to the Market’s Influence
While it is good to know exactly what may be transpiring in the market, you should not really give into this influence too unduly. A number of first-time home buyers tend to delay their decisions if the market is too seller-friendly (meaning that property prices are high) at the time of their initiation to it.Many changes in the market’s climate are for the short-term. Therefore, delaying your decision to buy for too long may not comprise a smart one – when the matter is analysed in retrospect, and when prices (following up on the case elaborated above) are afterward seen to ascend.
So if you find that your finances are in order, and you have a good offer available, then it may be wise for you to take the plunge.
The market – due to its bombardment with the standard crop of supply and demand forces – is prone to going up and down, but the need for a personal home is a significant long-term decision that both affects you and your dependents. The market may eventually become buyer-friendly, but there is no guarantee that you will be possessed of the right financial condition when this state eventually arises.
Hesitating to Negotiate Offers
Before finalising on a particular property option, it is a good (and what should be standard) decision to shortlist from a variety of the ones available. Real estate experts recommend scheduling up to seven homes to peruse at a time. You should, however, avoid comparing the sale price of one home to another.Of course, sellers are supposed to respect the going market rates in effect in their properties’ locations, as well as the rates of real estate in their vicinities. But it is common, expected practice for them to advertise prices that are somewhat higher than these figures. Therefore, as a first-time home buyer, you should know that the sales price of any piece of real estate is negotiable.
As a rule of thumb, prices that are generally considered comparable (benchmarks to conclude a sale) are associated with the same types of houses in the same location – and which have sold within the last three months.
On a related note, there are also some pending sales. These are those houses that await a settlement. Once the deal is closed, they can also be considered for their comparable sales potential.
Not Availing First-time Home Buying Programmes
Buying your own home is not just an important lifestyle decision, but one that usually costs a lot of money. Many people who obtain home loans, mortgages, or pay a large down payment (which decreases the payable amount of your monthly instalments) may fall into a financial crunch for several years after they make the acquisition.Fortunately, a large number of countries nowadays provide assistive programmes for first-time home buyers. These programmes offer support in paying down payments, securing competitive mortgage rates or feasible home loans; depending on the financing intent of loan retrievers.
If you’re a prospective homeowner in need of funds, you should definitely research if your government is offering such programmes and whether you qualify for any.
Tips for First-time Home Buyers
Consider acting on these helpful tips before you delve into the property market:Hire an Agent
Real estate agents are experts on the goings-on in your local market. They can, both individually and cumulatively, provide you with the best advice to match your particular financial standing and lifestyle needs.Home Inspection
Don’t give into a deal just because the home looks and feels good. Conduct a thorough inspection such as checking for a faulty foundation, leakages, worn-out installations, etc. This preliminary investigation can save you from spending copious sums on home repairs; especially after you’ve paid a hefty amount for purchasing it.Use a Property Portal
Instead of exhausting yourself narrowing one or two property options at a time, and then checking them out in-person, consider using online property portals to sift what’s what. As an example, take the case of Prop, a recent entrant to the online property space in Pakistan (a developing South Asian country that has been featuring quite prominently in the news lately).Online avenues like this site (both in emerging and accelerated economies) offer comprehensive listings of local properties that are available both for sale, rent or lease. Through their use, you can gather information on a number of real estate choices, shortlist those that suit your needs, and then check them out. This convenient and highly accessible method saves both your time and energy.
