Emotional Mistakes Home Buyers Make
Buying a home is stressful. You will, in fact, experience every single emotion on the planet. Not to mention the “Five Phases of Oh-NO!” So what are the common mistakes that buyers make over and over again?
1. Constantly looking for a better deal. The deal that’s good is the one that’s right in front of you. Real estate markets are like roller coasters they go up and down and there is no one way to determine when it’s the perfect time to buy. Truth is, yes, prices could drop, interest rates could go down–BUT they could shoot right back up. Right now in San Diego, we are in a seller’s market. Typically, homes on the market will sit on the market if overpriced. Homes that are priced well, you guessed it–multiple offers. If you find something you like, buy it.
2. Using the listing agent to buy your home. If you think for one second that you’re going to get a better deal on your home buy using the listing agent, you’re wrong! In fact, that listing agent already has a fiduciary duty to the seller and not to you. If the listing agent is smart– and they should be–they will have you sign a “Buyer Non-Agency Agreement.” What’s that mean? Just what it says– you have no representation. Period. Get an agent that’s going to work for you. If you don’t have one or you don’t know to ask an agent when hiring them find out what the 66 questions you should be asking your REALTOR are.
3. Falling in Love at First Sight. Buying a house isn’t some romantic love story. They don’t make movies about it because it shouldn’t happen. One of the biggest mistakes I see is people walking into home and seeing it with rose colored glasses. I can tell you– we have talked many people out of buying certain houses because it just wouldn’t make financial sense and wouldn’t be in their best interest. Listen to your agent. They are looking beyond the pretty kitchen. They are paying attention to the cracks in the ceiling and what’s running up the wall.
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4. Thinking Short Sales and Foreclosures are “good deals.” I get this question over and over again. As of yesterday, in the city of San Diego, there were 624 pre foreclosure homes. That does’t mean they were foreclosed on yet– there is still time for the seller to make back payments and or do a loan modification. The fact is… banks don’t just give away properties. They are selling the homes for market value based on the market, condition of the home and comparable properties. They aren’t the deal you’re thinking they are.
5. Low Balling Offers. Which brings me to the low ball offer. There’s a better way to make an offer than just on price. Seller’s don’t respond well to low ball offers. Instead of writing a low ball offer ask for other terms. For example, closing costs… this really only works when you’re not in a seller’s market. Ask for all transfer fees, home warranty, HOA documentation fees to be paid for. There are other ways to make a deal look sweet to the seller to make them take your offer.
6. Failing to Consider Additional Expenses. Being a homeowner comes with more responsibility. That means you’ll be the one who gets to call the plumber at 3:00 in the morning if a pipe breaks and when the dryer craps out… you guessed it… it’s on you! My best advice, put a slush fund together and hide it away so that when you do have unexpected things come up you are able to pay cash for those things.
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