2017 has been quite a year in DC real estate world. I’ve had the honor of helping many buyers on their homeownership journey and through the process I’ve had the opportunity to observe both the challenges and triumphs that come with purchasing a home. With that I’d like to share the most common mistakes that I see buyers make and some tips on avoiding them:
- Not getting fully pre-approved before looking at homes
Putting some numbers into an online calculator is not going to cut it. Figuring out how you are going to pay for a house is equally as important as what house you are going to buy. Would you go shopping for anything else without knowing how much money you have to spend? It’s VERY hard to reduce your budget and price range mid-search and be happy with the new options.
- Deciding exactly what you want after online research alone.
There are things that you can’t see or feel online. These things may make a difference in the direction of your home search. Your search may confirm that what you think you want, is actually what you want, but I find more often than not that this may change as you explore different options. Stay open minded.
- Attempting to buy the house that you think that you will need or want in 5 years rather than what makes sense today. (Exception — if you are getting to the age where you think you may be buying your last home, this does not apply!)
DC is expensive, and it’s hard enough to afford a home that meets your needs today, much less your future needs and the needs of your unborn children. As a young-ish adult, a lot can change in a few years. Buying in a good school area before you have children may cost you a lot in the long run if you miss out on a chance to build equity in a faster appreciating area. Having 3 bedrooms when you only need 1 means you’re paying a lot every month for space that you may not really need.
- Your family, friends, co-workers are great people who mean well, but they are not real estate professionals, and they may not be giving you advice that is actually helpful.
Real estate is a hot topic in D.C. and everyone wants to share their advice and experiences. As a real estate professional, I know that everyone’s search is different with different objectives, priorities and preferences, and my job is to help buyers reach the best possible outcome using my knowledge and experience. Your parents will always be advising that you proceed with caution, because they don’t want you to make a mistake or purchase that you will regret.
- Waiting too long to buy, paying high rents for longer than you need to because it’s easier.
Yes, investing a lot of money in anything is scary, but spending $20,000+ a year on rent knowing that you won’t ever see a dollar of it again should be even scarier! This isn’t to say that buying is the right decision for everyone, for many people it isn’t. Be conscious of how much money you are spending on rent and how that is affecting your overall financial plan
- Not exploring neighborhoods or areas that you are unfamiliar with.
You may love your current neighborhood, or know where you like to go out to dinner and spend time with friends, but that doesn’t mean that you shouldn’t at least see what you can get in different locations that also fit your objectives. Trendy neighborhoods are more expensive and more competitive. I myself have been surprised at some of the wonderful communities that exist in our area that are often not on buyers’ radars. Spend time exploring before you start searching, meet someone who lives in a neighborhood and ask them what they like or don’t like about it.
- Choosing the wrong real estate agent.
There is no one size fits all solution here. The agent who helped your parents, or brother, may not be the best one for you. There are so many things that are important when choosing a real estate agent but at the top of my list is their knowledge and experience with the type of property you are looking for and areas that you are considering for your search. If they have never had a buyer with a similar profile as you, the value they can add to your home search is a little limited and you will be learning together.
- Believing everything you read online.
Exploring the home purchase process online is a great idea, but it’s pretty comparable to googling your symptoms to self diagnose an illness. Might be fine if you have a cold, but for one of the single biggest purchases of your life — you might want to take the online info with a grain of salt and consult an expert. Don’t get me wrong, I think it’s incredibly valuable how much data and information is available online, but the interpretation of this information and applying it to your specific situation is equally as important.