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Check out Team Pinto’s insider secrets to avoid costly blunders on the most important investment of your life.
Today we decided to put together a post about some of the biggest mistakes we see people make when buying and selling homes, and how you can avoid them.
Purchasing a Home for the Decor
Remember that you are purchasing the house, not the contents within it, so look past the decorations and into the structure of the home. Pay attention to the floor plan and the amount of space available. Check the dimensions and make a graph to see how they will work with your belongings.
Making Showings Hard to Accomplish
Make it simple for potential buyers to access your home. If there’s no place to park or it’s difficult to get into, buyers may choose to look at another home instead.
Not Doing Any Research on the Area
Before you buy, it’s critical that you do your homework on the neighborhood. Examine the neighborhood, amenities, and school system to ensure that your address is in the correct school district. If at all possible, attend a community meeting. You’re not just purchasing a home; you’re purchasing a piece of real estate as well as the surrounding land.
While Showing, Attempting a “Hard Sell”
You should not be present at an open house or a private showing if you are selling your home. You may want to try to sell the house based on all of the reasons you think it’s great, but the buyer may not agree. If you leave, the buyers will be able to provide the agent with unbiased, objective feedback, which will only benefit you in the long run.
Waiting to Sell Your House Until Spring
Spring is the busiest season for real estate transactions, but that doesn’t mean people don’t buy homes all year.
Treating Real Estate as if It Were a Stock Market
When the real estate market is extremely hot and rapidly appreciating, people tend to treat it as if it were a stock market. However, investing in real estate is not like investing in stocks; you must take a long-term approach to real estate.
Failure to Market Your House in a Variety of Ways
Don’t just put a “for sale” sign on the lawn. Look into other marketing options as well. Talk to your real estate agent about how he or she plans to market your home. It’s something that should start as soon as a contract with an agent is signed. Virtual tours, drone photography, and other features are popular right now, and they usually attract far more attention, much faster.
Not Considering Resale
When it comes to decorating and renovating your home, consider what will appeal to a wide range of buyers when it comes time to sell it. Buying houses and being in the real estate market is similar to chess in that you want to be two or three steps ahead of the game.
Putting Faith in Everything a Real Estate Ad Says
Don’t take every advertisement at face value. Acquire a working knowledge of real estate jargon. For example, “cozy” frequently denotes a small space, and “as is” denotes a fixer-upper. If an advertisement contains a lot of exclamation points, it’s because there’s not much to say about the location. It’s a good rule of thumb to remember: if it sounds too good to be true, it probably is.
Making the Wrong Agent Selection
Treat meetings with agents the same way you would a job interview because that’s how they work. Keep in mind that this individual will be working for you.
Talk to friends who have recently sold a home and had positive experiences with their agent, and attend open houses to see how that agent interacts with other people. Meeting with the agent in their office is also a good idea. It allows you to see how well-organized he or she is, as well as the type of environment in which they work and whether or not that environment is conducive to doing a good job for you.
Purchasing the Most Expensive House in the Neighbourhood
The most expensive house will depreciate in value rather than appreciate in value over time, which is what you want. Also, because those houses are typically overbuilt for the neighbourhood, they aren’t the first to sell. It’s critical that you do your homework on the neighboruhood before buying to determine what the price range should be.
Setting a Budget That Isn’t Realistic
Just because you’ve been prequalified for a $500,000 loan doesn’t mean you can afford to pay it back every month. Before you hit the streets looking for a home, sit down and make a monthly budget of how much you spend each month. Apart from those other expenses, come up with a number that you are comfortable spending on your mortgage payment.
A simple way to do this is to set aside a third of your gross income as the amount you spend on your home. It’s also a good idea to have six to nine months’ worth of mortgage payments saved up, plus a little extra in case you need to make any repairs.
Only Visiting the House Once
It’s crucial to go to a house multiple times because the neighborhood can be very different depending on the day of the week and time of day. It’s also a good idea to go home and think about it, if possible sleeping on it, before returning.
Not Being Pro-Active When It Comes to Closing
When it comes to closings, the best thing to do is prepare all the paperwork ahead of time. A mortgage broker or banker should provide all of this information. Try to schedule the closing for early in the morning, so you can go over everything and ask questions with a fresh mind. Another crucial step in the process is the final walk-through. You might want to bring a home inspector with you for that too.
Before Selling, Making Major Renovations/Remodeling
Don’t feel obligated to make major improvements before putting your house on the market. Touch-ups here and there, particularly outside the house, usually suffice.
Minor improvements usually yield a better return on investment than major renovations before putting a house on the market. What is the main reason? Large construction projects always cost more than you expect and take longer than you anticipate. Outside is the best place to spend money. According to research, improving curb appeal often provides the best return on investment. It’s what brings buyers in the door.
Skipping the Pre-Approval Process for a Loan
“We will give you a mortgage of up to this amount,” the bank says when you’re pre-approved. “Now all you have to do is find your home.” Some sellers will only allow real estate agents to show their home to buyers who have received a pre-approval letter. This shows that the shopper is serious about purchasing a home.
Setting Your Heart on the First House You See
Many people, especially first-time homebuyers, make the mistake of falling in love with the first house they see. To get an idea of what the comparables in that price range are, you should look at least three more houses in the area. You want your agent to show you homes that are similar to the ones you saw. Re-evaluate at the end of the day.
Purchasing a Home Without an Inspection
A home inspection can reveal many things about a property that are not visible to the naked eye. Hire someone who has a strong referral base, has been in the industry for a while, and knows what to look for. Once you’ve found an inspector, ask that they write a report that includes photos. Photographs are important because a home inspector will look in places that you might not.
Ignoring the Additional and Hidden Costs
It’s not just about the money you spend up front when you buy a house; it’s about all the money you have to spend after that. Find out how much your property taxes are, how much your water bill is, and how much a typical electric bill is in that home, especially if you have electric heat rather than gas heat. You’ll also need to account for any furniture you’ll need to buy before you can move in.
Buying What You Want, Not What You Need
Take a look at the space you already have. It will assist you in determining what you’ve been missing and what you’ll require in your next residence. Make a list of those requirements, and then ask your agent to begin shopping for them.
On average, Canadians stay in their homes for nine years. Remember that you can always trade up a few times before finding your dream home.
Making Minor Cosmetic Changes and Failing to Showcase Your Home
When it comes to selling your home, you must examine it objectively and consider it from the perspective of a potential buyer. Make minor changes to the home and consider hiring a professional stager to help you arrange your furniture. Staging entails decorating your home to appeal to the buyers’ preferences rather than your own.
The front of the house and the main entryway are excellent places to begin. The goal of home staging is to increase the potential selling price and shorten the time the house is on the market.