Most of us will buy at least one home in our lifetime, and there are a few things that you should consider before buying a home. By taking these thoughts into consideration before buying, you will save yourself the trouble of making the mistakes that many other home buyers have made. So do yourself a favor and remember:
Consider your exit strategy—I know it is usually the last thing you are thinking of when buying a home, but it shouldn’t be. Someday, you or your heirs are going to sell the home. When you do sell it, you are going to want to get the largest return possible. Remember—location, location, location and think about the next owner when doing any renovations.
Reality TV isn’t real – It is great how people on television go out for a fun little day trip, look at three houses and find the house of their dreams. Sorry, but it doesn’t really work that way. Those shows edit hundreds of hours of footage to show the half hour that you see. Finding the house that you will call home takes time and work. So prepare for the home buying process, make the time and effort commitment necessary to make your search a success.
Houses are not perfect—always get a housing inspection—all houses have problems. Many buyers are surprised at the length and detail of a general housing inspection. More importantly, they are floored by the problems that show up in them. It is important to remember, inspectors are professional doomsayers. That is why you want, but most problems they find will be inexpensive and easily fixed. Do not walk away from your dream house because of a leaky faucet. Most repairs can be negotiated into the contract. Just be prepared to find out that the perfect house you found isn’t so perfect.
You are not just buying a house—you are also buying a mortgage. This is probably the most important thing to keep in mind. Shop just as hard for your mortgage as you do for your house. This is not just a minor detail or expense. It is actually in most cases the most significant part of the purchase. Take advantage of low rates. They add buying power to your home search. Low interest rates are much more important than low housing prices. Most people make their buying decision based on what their monthly payment is going to be (can I afford it, or not) If interest rates go up 1 percent, housing prices need to drop 10 percent to keep your monthly mortgage payment the same.
Work with a real estate partner, not a real estate salesperson—your real estate agent shouldn’t try to sell you anything. Your agent should try to find the house of your dreams (in your price range, that is) and help you navigate the buying process. Find an agent that you are comfortable with and can communicate clearly with. A good agent will simplify the process and protect your rights from the start of the process until after the purchase.
If you keep these thoughts in mind when buying your home, you will be much happier in the long run. Isn’t it much nicer (and cheaper) to learn from the mistakes of others.
Rick Yost is a real estate partner with Keller Williams Realty and an author of the book “Help! My house is upside down” a book about short sales.