There are many things to consider when buying or building a home. Here are the top 10 things to avoid when doing so. In future posts I will go into more detail on many of these items.
1) Not taking the time to consider all the costs of your purchase or project including the ongoing costs of owning your new property such as property taxes, homeowners association fees, utility costs, insurance costs, maintenance costs and many others. These expenses will significantly impact if you can really afford a property or not.
2) Not understanding the process and paperwork requried to complete the transaction. This includes items like the process of getting a loan, the process of taking title and what your options are in doing so, the process of getting insurance on the property and very often ignored what steps are required per the contract to be completed to actually get the home purchased. Have you actually read the contract and had your agent explain it to you? This is a legal document. These kinds of items can significantly impact if you can buy what you want or what may happen years down the road.
3) Not considering all external factors about the the property you will be buying or issues with the lot where you will be building your new home. For example, is the property in a homeowners association and if so what are the rules? What is the zoning of the property and what can be built on the lot you are about to buy? Does the house have things that need to be repaired and can you get the seller to pay for fixing those items?
4) Not considering the neighboring properties. Is the house next door in good condition or does it need major repairs? Is it an eyesore which will effect the value of your property? If there is a lot next door with no home built on it would a property eventually built on that lot block your views down the road?
5) Not considering the neighborhood and how this might affect your enjoyment of the property. Is the property close to where you work? Is it close to good schools? Is it close to where you spend time regularly? With relatives or friends? The gym, the coffee shop, stores you like and events you go to?
6) Not considering your future. How long do you plan to live in the property? Are you planning on having kids and will you need a bigger house soon? Are you planning on retiring to a different location? Take a few moments to think of the future and make sure what you are doing makes sense not just today but also for your future.
7) Not making sure the home works for everyone who will be living there. If your married does the home work for both of you or does it at least have, at a minimum, what each spouse needs in a home. If you have kids are they going to be able to have rooms that they like. If different people have different hobbies is there space for each of them. Take a few minutes and think about how you are actually going to live in the house and use the space.
8) Not considering what you need vs what you want. Many times people spend too much to buy a property with what they think they want, what is cool, what is the latest and greatest. Do you really need all the features in the property you are buying or building or are you getting them because you friends have them or you think you want them today. There are no right or wrong answers but many times people spend more than what they budgeted and soon after they are in the home realize they are not using what they thought was cool when they first looked at the home. Think about it, it is your money.
9) Not asking questions and working with professionals. This often is the largest purchase in your life so you it is better to work with professionals who will take as much time as you need to answer every question you have. Don’t assume you know everything or that your realtor/builder/lender/title company/home inspector or other person you are working with is going to tell you everything, represent your best interest or even that they know everything. There are many great professionals you can work with in buying or building a home so find one and ask those questions you don’t think are important or that seem dumb. You might be surprised what you find out.
10) Not having fun with the process. Don’t get too stressed out. This is a stressful process but this is going to be your home so it better be someplace you will enjoy if not love. This is more than just an investment decision even though that is important to consider. You need to make sure what you buy suits you and your lifestyle and that you are working with people who are knowledgeable and who can help you reach your goal. Good Luck!