With spring officially here (finally!), let’s continue our discussion on real estate. In my last article, we talked about the importance of being pre-approved for a mortgage before you go house hunting. Once you have your finances in order, only then can think about buying the property itself.
House hunting is an exciting time, but if you’re not careful you can make a costly mistake along the way. Let’s take a look at three common home buying mistakes and how to avoid them.
Mistake #1: Not Being Flexible with Your Home-Buying Needs and Wants
Before you go house hunting, it’s a good idea to come up with a list of needs and wants. Examples of need include three bedrooms and two bathrooms and wants include a Jacuzzi and deck.
While it’s helpful to have a list of top 5 needs and wants, be careful not to go overboard. If your list of needs and wants is too long and you’re not willing to compromise, it could take you a very long time to find the ideal home. I’m not saying that you should compromise on something crucial like the number of bedrooms, but if a home has something you’re not particularly fond of like carpeting in the basement, that can be fixed. I hate to break it to you, but if you’re looking for the perfect home, you could be looking for quite a while.
Mistake #2: Not Focusing on the Bones of the Home
Another mistake to make when you’re house hunting is focusing on the wrong things. When you’re looking at properties, it’s easy to focus on the cosmetics and overlook what I liked to call the “bones” of the house. Cosmetics are things like a newly renovated kitchen and bathroom, hardwood floors and paint colours.
While those things are all nice, make sure you don’t overlook the most costly parts of the home. I’m talking about the roof, windows and furnace. Those can end up costing you a pretty penny to repair. Likewise, see if there’s any dampness in the basement. Waterproofing your house can be one of the most costly things a homeowner can face.
Mistake #3: Skipping the Home Inspection
When you see a place that you like and five other people are interested, it’s easy to skip the home inspection and go in with an offer without any conditions. But by doing this, you’re leaving yourself open to all sorts of problems later on. Not only does getting a home inspection offer you piece of mind, it can be a good negotiating tool. If you find something wrong with the property, you could ask the seller to knock an amount off the selling price to compensate you for it.
So, you want to get a home inspection, but you’re worried that you’ll lose the house since there are other people making offers. What can you do? You can get something called a “pre-inspection.” A pre-inspection is when you get your home inspection done before you make an offer on a property. By doing that you don’t have to include it as a condition, improving your chances of getting the property.
About the Author
Sean Cooper is the bestselling author of the book, Burn Your Mortgage: The Simple, Powerful Path to Financial Freedom for Canadians. He bought his first house when he was only 27 in Toronto and paid off his mortgage in just 3 years by age 30. An in-demand Personal Finance Journalist, Money Coach and Speaker, his articles and blogs have been featured in publications such as the Toronto Star, Globe and Mail, Financial Post and MoneySense. Connect with Sean on LinkedIn, Twitter, Facebook and Instagram.