It’s one of the biggest commitments you’ll ever make-choosing a new home. So it’s no wonder the decision puts a strain not just on the finances, but on families too. Here’s how to reduce the stress of buying a property.
You’ve done the right thing and got pre-approval for your home loan, and are now busy scanning real estate sites and visiting open homes for inspection, all in the hunt for the house of your dreams. For many prospective home buyers, this is one of the more fun parts of the process but for others, it can become a pressure cooker of stress! Here are some of the pitfalls you might encounter on your way to finding that perfect property. Avoid these mistakes to reduce some of the inevitable stress and you’ll be unloading the removal van before you know it!
Mistake 1: Wasting Time
When it’s first brought to market, a home for sale is “hot property”. The marketing campaign will likely be vigorous and that generates competition- so lots of buyers will be seeing the house at the same time as you so you can’t afford to hang around and take too long making up your mind. Check the ‘for sale’ listings daily and stay in close contact with agents so that when you spot a property that ticks all your boxes you can act right away. Get in to see it as soon as you can – don’t wait until the weekend, it might be sold by then!
Mistake 2: Losing Your Pre Approval
Some buyers don’t realise that pre-approval for a loan usually has a defined time limit before it expires. Be aware of this and don’t find your perfect home the week after the time has expired or you wont be able to get your finances in order and you’ll likely lose out.
As well, several factors determine being granted pre-approval (such as employment status, your income, outgoings, and credit score). If you receive pre-approval, it’s best NOT to change any of these factors. Please contact your mortgage broker if you are considering making any changes which might affect your pre-approval status. These include, but are not limited to:
- Opening new lines of credit or loans
- Opening a new credit card or increasing the balance or limit on existing cards
Also, ensure payments to existing financial commitments are made on time. And please, for the sake of the sanity of your poor mortgage broker, DO NOT make large purchases such as new cars, expensive furniture etc. Even if you use savings to purchase these items, those savings were included by your lender when assessing your ability to repay the loan they pre-approved, and spending up on big items can effect the balance.
Mistake 3: Making a Low Offer
In a seller’s market, the seller can take their pick of offers from several prospective buyers – so you need to distinguish yourself from the pack. Having pre-approval will help with that, but if you can’t bear to a particular house slip through your hands, you are going to have to play your hand and make a very realistic offer. Your real estate agent should be able to guide you on what’s appropriate, but this is not the time to be making a low offer ”just in case”. Make an offer that’s realistic but still competitive or you risk being pushed out of the competition.
Mistake 4: Thinking It’s All about The Money
Even if you have made an attractive offer, always remember that there might be another buyer out there prepared to offer more, or whom might be able to offer a preferable settlement date, or who has no property to sell before they can make the commitment. For these reasons. it’s important to promote yourself as the most preferable buyer in the eyes of the vendor and that includes being flexible and not making too many demands. Work with your real estate agent and find out what is motivating the vendor. They may simply be looking for the highest offer but it could be that they want a long or short settlement, or they may want to offload contents if they are downsizing. If you can work in with these extra terms, you increase your chances.
Mistake 5: Using the Home Inspection Report As A Negotiating Tool
When you receive your home inspection report, it may be so thick it reads like War and Peace and makes you think the house is about to fall down. If this is the case, you need to make a decision based on what state of repair you are prepared to accept in the home. Are you happy to accept having to make minor repairs? Are you game for some serious renovations and the cost and inconvenience of them?
Depending on the report, you may be able to negotiate with the vendor to have some issues addressed – but don’t assume it. Remember Mistake 4 and stay flexible, and that means it might not pay to see any problems with the property as a negotiating tool to obtain a reduced selling price. Instead, consider what’s more important to you- having to do repair work, paying less, or missing out.
Mistake 6: The Dreaded Buyer’s Remorse
We’ve all done it! Bought something, continued shopping – and then found something better!! It’s one thing when it’s a pair of shoes, but this is more serious when the purchase is a property, because not only is the financial commitment bigger, but as soon as you sign a contract on a house you are legally obliged. So once you have committed, STOP looking at homes for sale and start planning your new life in the home you’ve already decided is the right home for you. There is no point finding something perfect for you once you’ve already committed to another home.
These are just some of the mistakes that buyers should avoid to reduce the stress of purchasing a new home. Try to remember them, and surround yourself with trusted professionals such as mortgage brokers, real estate agents, conveyancers etc. Use their expertise to help guide your decisions and you’ll go a long way to having a happy and exciting journey towards owing that new home. And try to have fun! It’s an exciting time.