Top 7 Mistakes New Home Buyers Make
By Joshua Ferris
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With all the glamour and luxury options to choose from when shopping for a new construction home its easy to get caught up in the overall experience and not put as much emphasis on the most important aspects of buying a home. Read on to find out the seven mistakes many new home buyers make.
- Not Spending Enough Time Analyzing Lot Options
Did you know that homeowners feel more secure in their home when they look down at the road (based on a hill) versus looking up at the road (below road grade)? This will have a big impact on resale value in addition to location (cul-de-sac locations tend to sell for more) and lot shape.
- Accepting Builder Financing as Their Only Option
Builders want to work with lenders that they can count on to push your mortgage through and close without a hitch. They like it so much in fact that many of the largest builders in the country own their own financing company to help you obtain a mortgage. While builders may have tempting incentives tied into their mortgage offers you should consider any hidden costs associated with the deal by comparing the builder's financing company offer with that of another direct lender and offers from a mortgage broker.
- Neglecting to Check for an Inspection Clause
Can you inspect your new home before the purchase is finalized? Most builders will allow you to inspect the home with a licensed home inspector but some may put a clause in the contract stating that inspections will not be allowed until after closing. The builders may not be hiding anything but you are making one of life's largest investments so shouldn't you know how well built the home you are buying is? Caveat emptor indeed.
- Failing to Use a Buyer Agent
There are a few spectacular buyer agents out there who specialize in new home and buyer representation. The agent should be able to guide you through community and lot selection, future changes in the area and ideal home pricing among other things. Also, builders allocate a portion of their marketing budget to compensate real estate buyer agents used by their home purchasers so the service is typically provided at no cost to you.
- Not Checking the Facts From Advertisements
Location, location, location! That's what they say about real estate and in some ways its true. For example, most home buyers would like to be, at most, about an hour from work. If you read through some real estate advertisements though you'll notice that almost every community being advertised is only about an hour from where you work when in reality some may be 90 minutes or even 2 hours! Check the facts before you commit.
- Going on an Upgrade Spending Spree
Open up any builder's upgrade selection and prepare to be dazzled by all the shiny new things you can put into your future home. Unfortunately all those options come with a price tag that could have you seeing red. Stick with the most essential upgrades like upgraded carpet padding, hardwood floors, upgraded cabinetry and high end appliances. Rule of thumb: Most home buyers spend about 10% of their purchase price on upgrades.
- Forgetting About Vital Needs and Following Their Hearts
Model homes can be absolutely jaw dropping gorgeous but you have to keep in mind that they are designed to be that way. Focus first on your most vital needs: mass transit, proximity to schools and shopping, crime rates etc. and then choose to tour communities that only meet your criteria. By doing this you can still fall in love but for all the right reasons.
Joshua Ferris is an associate real estate broker in Orange County NY and specializes in both Monroe New York and Newburgh New York real estate. Learn more about Orange County by visiting Josh's website at http://housemeetsowner.com.
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Article Submitted On: December 11, 2008