Real estate is a high stakes game. When buying a home buyers often worry about making a mistake that will cost them money. The market today is filled with challenges and home buyers anxiety is high. What should a buyer do to avoid making costly mistakes?
How to avoid costly mistakes
One of the most important things to avoid making costly mistakes is to be educated on the market you are buying in. Do not try to time the market. If you wait for the perfect time to buy, you may miss out. If fact the biggest mistake that homebuyer can make right now is not moving forward because they are waiting for interest rates to go down.
Here are some “what if” scenarios that you can ask yourself to help you see how to avoid some costly mistakes.
- “What if” you buy now and prices drop? If that happens you will not feel that until you sell and that will more than likely be years down the line. So you have not really lost anything by buying now.
- “What if” you buy now and interest rates go down? You can always refinance your mortgage when rates get low enough that it makes since to do so.
- “What if” you don’t buy now and prices and rates keep going up? If that is the case you may become priced out of the market and not be able to do anything buy rent for longer than you planned. Looking at these scenarios you can see that waiting to buy a home is not likely to change the fundamentals of the market. Long term real estate is still one of the best ways to build long term wealth. When you own your home, you are building equity. When you are renting, you are helping someone else gain equity.
Let’s buy now!
So you have decided to might be okay to buy and not wait. What other mistakes should you avoid? A mistake to avoid is falling in love with a house that you cannot afford. Make sure, when you decide the time is right, to get pre-approved with a lender so that you know what you can afford. Then make sure you look only within that price range. A home more expensive is going to impress and make it easy to fall in love. Pre-approval is important and can help you avoid stress and other costly mistakes.
These are just a few costly mistakes to avoid. This is part one of a two part series. Stay tuned to read part two and learn about more costly mistakes to avoid as a home buyer. The more you know the better your experience will be.