10 Mistakes to Avoid when Buying a Home
1. Searching for houses without getting pre-approved by a lender:
Pre-approval gives you substantial leverage. You will know the exact price you can afford and you will be able to negotiate a better deal when you find the right house.
2. Not shopping for mortgage terms:
Rates are negotiable! Banks will sharpen their pencils to get your business, especially if you have a good credit rating and bring other business to them. Also ask whether the bank will cover appraisal fees and about payment options, penalties, etc. This can save you thousands of dollars over the life of the mortgage.
3. Allowing “first impressions” to overly influence your decision:
Examine a home objectively. Don’t let the current owner’s style influence your judgment.
4. Failing to have the home inspected before you buy:
A home inspection will offer you reassurance that the choice you’re making is a sound one, or alert you to problems that could cost you significant money. If the inspection identifies deficiencies you may be able to negotiate the purchase price. I can suggest reputable home inspection companies for you to consider.
5. Not knowing and understanding your rights and obligations as listed in the Offer to Purchase:
A lack of understanding about your obligations may cause friction between yourself and the people with whom you are about to enter the contract. Take the time to go through the contract in detail, making use of the resources and knowledge offered by myself and your lawyer.
6. Making an offer based on the asking price, not the market value:
I will prepare for you a Comparative Market Analysis that will provide you with the necessary information to define the market value of a home, and will help you avoid over-paying. What have other similar homes sold for in the area and how long were they on the market? What is the difference between their asking and selling prices? Is the home you’re looking at under-priced, over-priced, or fair value?
7. Failing to familiarize yourself with the neighbourhood before buying:
Check out the neighbourhood you’re considering, and ask around. What amenities does the area offer? Are there schools, parks, or grocery stores within reach? Consider visiting schools in the area if you have children. How will you be affected by a new commute to work? Are there infrastructure projects in development?
8. Not Knowing the Full Cost of Home Buying:
Know all the costs associated with your purchase: legal fees, transfer tax, property taxes, new home landscaping, appliances, window coverings.
9. Not looking for home insurance until you are about to move:
If you wait until the last minute, you’ll be rushed to find an insurance policy that’s the ideal fit for you. Make sure you give yourself enough time to shop around in order to get the best deal.
10. Not recognizing different styles and strategies of negotiation:
Many buyers think that the way to negotiate their way to a fair price is by offering low. However, this strategy may actually result in the seller becoming more inflexible, polarizing negotiations. With my skills and experience, I can guide you through which strategies of negotiation will prove most effective for your particular situation.