PLAN YOUR NEED:

It is important to plan carefully for the future events and how they may affect your home buying. Plan to stay in each home for at least two years because when you sell, you want to make at least your purchase price plus any closing costs. If the house has not appreciated by 6 to 8 percent (typical percentage costs associated with closing), you can lose money.

MISTAKE #1

Thinking Too Long Term

There is danger in buying a home that is not right for you because you are planning too far in advance. Your life can change pretty dramatically in the space of a few short years. You may experience a change in health, family or financial status for example. While you can not plan for everything, you do need to consider that you may have to sell the home unexpectedly in the not-so distant future and the house must have some resale value.

MISTAKE #2

Waiting Too Long

It is a big decision and only a foolish person would enter into it lightly. But it is just as easy to let caution get the better of you. The real estate market is not fixed, it can change dramatically. Some markets are very tight with few homes available – a tight market probably will not get better in the next year. The National Association of Realtors estimates that the appreciation rate in most markets will be at least 4 to 6 percent. Looking at everything before making a decision, it is tempting to think that the grass is always greener somewhere else, but you may find that the first home is the best home for you. If you wait, that home may not be available later. Do not rush into a decision, but if a house feels right, contact your realtor to help you make an appropriate offer.

MISTAKE #3

Focusing on a Single Feature

If you develop microscopic vision when looking at a house, it is possible to overlook far greater potential problems.

Interior Decorating – Do not get caught in the decorating features. These are all easy features to change. However, the layout and floor plan of the home isn’t easy to change.

Exterior – It is important to have a home with nice curb appeal, but again, you can change that later. It is far easier to change landscaping than it is to rip out walls or add-on to a home to try and make it livable.

Price – Do not focus completely on the price. Most buyers go out with the idea that they will only spend a fixed amount. A budgeted amount is often the first criteria when it comes time to evaluating homes.

MISTAKE #4

Overlooking New Construction

Many buyers focus on existing homes and do not consider newly constructed homes. It is hard to see the final vision of a planned home community, especially when touring through a development that is merely empty lots and partially built homes.

However, these homes have great appreciation value, especially when you get in during the inital phases of the development before the model homes have been built and the developer has invested a lot of money in marketing the community.

MISTAKE #5

Working without an Agent

Many people start looking at homes by driving by a home for sale and getting the number off the sign or visiting an open house. While that is a great way to get a feel for the market, it is also easy to make a commitment to buying a home that does not necessarily reflect your best interests. Working with a real estate agent can actually save you time and money.

MISTAKE #6

Rushing the Process

Let’s say you found your dream home and put in an offer. What happens next? If your sale follows most standard sales, the home is inspected and appraised; the information is shared with the buyer (via the agent) and the mortgage company. The mortgage company processes the loan agreement, the buyer and seller sign off and the home is yours! However, in highly competitive markets, some buyers waive the home inspection so that the loan can go through more quickly. So what’s the problem? If there are defects that the home buyers discover later, they have no recourse – the house id theirs, warts and all. In a nutshell, be patient. It’s at this stage when people try to rush the process that some of the biggest and most costly mistakes can take place.