The United States currently has an approximately 65% homeownership rate. People all over are finding ways to become homeowners, and it’s a dream you can achieve with some diligence and research. Most importantly, you need to understand what mistakes you can avoid that will set you on the right path.
We’re happy to steer you in the right direction. Here are some steps you can take to avoid common homebuying mistakes.
Consider Your Finances Early
If you’re thinking about purchasing a home, you have to get your finances together first. Figure out how much money you bring in each month and year, compared with your expenses. Determine how much per month you could comfortably pay in a mortgage.
From there, start reaching out to banks and credit unions to get pre-approved for a mortgage. This lets you know what kind of spending power you have when you hit the market.
Many homebuyers make the mistake of rushing into a mortgage without considering their full financial situation. They don’t study the market to learn what kinds of deals are available and end up taking a loan with high interest rates and clauses that don’t serve them.
Get all of your financial records in order, including tax returns, bank statements, income stubs, and documentation of any assets you own. Pull your credit report and score to find out if you’ll get approved for the best loans.
Have a Checklist for What You Want and Need
Another mistake that homeowners make is that they don’t fully consider what they want and need in a home. Going with “good enough” is risky for a property that you’re going to be paying for the next 30 years.
Consider how many bedrooms you’d like to have, how much square footage you need, and what you are looking for in terms of land and acreage. Figure out what neighborhood you’d most like to live in and what schools the neighborhoods are zoned for. Take the time to study different home layouts so that you get what you need in terms of quality of life and functionality.
Choose a Newer Property
When at all possible, make sure that you choose a property that was built within the last 10 years. This will give you more bang for your buck and more room to grow in terms of equity. Buying a newer property also lowers the total cost of ownership since you won’t have to get things fixed nearly as much.
Newer homes are built with energy efficiency in mind, so you can also expect your utility bills to be less expensive.
Many homeowners purchase older homes that they intend to fix up. This is great in theory, but most homeowners aren’t experienced enough to consistently put a lot of work into a property. For the novice homeowner, you’re better off with a home that won’t require much effort.
Don’t Overlook Curb Appeal
Curb appeal is just as important to the property as anything. This is one of the biggest indicators of whether a home will sell. When you’re viewing properties to buy, steer clear of homes that are drab and dry, without proper care given to the landscaping.
Consider your first impressions when you pull up to the property and what it makes you think and feel. This should help you get some ideas about different landscaping improvements you can make throughout the years. Some of the best curb appeal upgrades you can make include:
- Painting the exterior a different color
- Get rid of any old and outdated porch or front door hardware
- Plant a few trees
- Keep the grass meticulously cut regularly
- Add elegant seating to the porch
- Give the siding and hardscape a good pressure wash
- Add some beautiful outdoor lighting
Keep these sorts of attributes in mind when you’re visiting homes on your list.
Find the Best Real Estate Agent Available
It’s always to your best advantage to work with a real estate agent that can help you out. These professionals will help you scour the market for the best deals until you find the one that suits you. Several buyers make the mistake of trying to purchase their home by themselves, rather than having a pro.
This reduces your leverage and doesn’t let you fully explore the market. Schedule meetings with a few realtors until you find the best fit.
Make sure that they are certified by organizations like the National Association of Realtors (NAR) and get some recommendations. Once you let these professionals know what you’re looking for in a property, they can weed out the several different ones that they have in listings and assist you in making a solid offer.
This is especially important when buying home with multiple bids. Your real estate agent will guide you through the process so that you can beat out other buyers’ offers.
Take a Homeownership Class
Never assume you know the full ins and outs of buying a home. Too many homebuyers rush into the process, only to quickly get in over their heads. You can learn everything that you need to know by taking a homeownership class.
This class will walk you through all of the steps of the process so that no stone is left unturned. You’ll go into the process feeling informed and will be less likely to catch a bad deal. A homeownership class can also point you toward resources for certified public accountants (CPA), real estate lawyers, real estate agents, and other professionals.
Avoid the Most Common Homebuying Mistakes
When you follow the points above it’s easier to avoid the most common homebuying mistakes. Do your due diligence by researching the market and finding out what’s available. Buying a home is a dream for most, so never shy away from putting in the work required.
Start here and check out our other articles when you’re ready to make sound real estate investments.
