By Peter O'Malley
Author of Inside Real Estate
Buying a home is one of the biggest steps most of us take in life so it’s important to make sure you avoid some of the pitfalls. Here are some tips for those venturing out to buy a property.
Buying What You Want Instead of What You Need
There are two kinds of buyers: those who buy what they want, and those who buy what they need. The public world of materialism is often a private world of financial stress. Do you really need four or five bedrooms? Do you need to live in the “best” area? You can buy a better home in a less expensive – and less prestigious area.
What’s more important? Struggling to maintain an image of wealth or living safely within your means? Most buyers could save tens, possibly hundreds of thousands of dollars by buying what they need instead of what they want.
Losing Money with Auctions
While you can often buy at a lower price with auctions, your challenge is discovering the truth about the likely selling price. At auctions, thousands of home buyers lose money through legal and inspection costs for homes they never had a chance of buying. When they realise they have been tricked it breaks their hearts. Auctions can be deceitful and cruel.
Unless you know what you are doing, it may be best to do what many buyers do – forget about buying at auction.
Get INDEPENDENT Inspections and Advice
It is essential for your financial and emotional well being that you obtain an independent building inspection report. Be sure you discover any major faults before you buy the home. The biggest word to remember is the word “independent”. Some agents receive kickbacks from advisors they recommend, make sure to ask the agent what their policy is in this regard. Also, be sure to get legal advice before you sign anything. It is madness to make one of the biggest financial decisions of your life without independent advice. If in doubt about the price, consider obtaining a valuation. The hundreds of dollars you spend could easily save you thousands of dollars. Spend it.
Being Too Quick or Too Slow
The right time to buy a home is when you find the right home at a price you can afford. This can happen on the first day you start looking or it can take weeks, even months, of painstaking effort. Don’t hesitate to buy if you find the right home, but also, don’t be pushed into making a hasty decision. No matter what you might think, you will always find another home. Take the time to make sure everything feels right and that everything checks out. Whenever this happens, be it on the first day or after several weeks, it is then the right time to buy.