Top 3 Home Buying Mistakes to Avoid

The process of home buying can be one of the most rewarding experiences of your life. Buying a home can be very exciting and present you with many financial advantages. However, many home buyers make some mistakes along the way that end up costing them in the long run. Here are a few home buying mistakes to avoid. 

1. Buying More House Than You Can Afford

One of the most common home buying mistakes is purchasing a house that is more than what you can afford. While the financial ratios at the bank might tell you that you can afford one price, reality might tell you something else. Many people want to borrow the maximum amount that they can borrow when buying a new house. While this might get you a better house, it also straps you financially. A mortgage is a huge commitment that typically lasts for 30 years. Therefore, if the mortgage is more than you can handle, it throws all of your other finances out of proportion. Make sure that you know exactly how much of a monthly payment that you can afford and stick to that number. 

2. Overpaying for a House

Many people go out into the market and fall in love with a home right away. They decide that they are going to buy it before they look at any other houses. The house might be overpriced for the rest of the market. People pay for the overpriced house and then they do not realize any appreciation with the rest of the market. Part of the incentive of owning a home is that the value of the property will go up over time. However, if you pay more than you should for a house, this benefit might be negated during the time period that you live in the home. You should strive to find undervalued homes so that you can realize the greatest return when you go to sell the house in the future. 

3. Not Factoring in the Neighborhood

When you buy a house, you should always take into consideration the neighborhood surrounding it. While the house itself might be beautiful and exactly what you are looking for, if the rest of the neighborhood is awful, it is still not in your best interest to buy the house. A poor neighborhood can eventually bring down the value of your property. It can make it difficult to sell in the future. Therefore, the condition of the surrounding houses can actually affect you financially if you fail to consider the consequences. If you are not familiar with the neighborhood, be sure to ask your real estate agent several questions about it. If they are a trustworthy real estate agent, they will tell you which neighborhoods you want to buy into and which ones to avoid. 

blog comments powered by Disqus