Home Buying in Cincinnati>Question Details

Trent Warner…, Real Estate Pro in Cincinnati, OH

What are some of the mistakes first time home buyers make?

Asked by Trent Warner Monopoly Builder, Cincinnati, OH Sun Oct 24, 2010

Help the community by answering this question:

Answers

17
They look at the granite and stainless and overlook the quality of the structure it all sits in.
They should look for quality construction and buy a new fridge next year.
1 vote Thank Flag Link Sat Nov 20, 2010
Mack,
Hah! I love to travel overseas alone. I love to explore on my own. Really.
Yup safari too. And, true story,....I rarely see in some guide book something I missed but I see lots of things that guide books miss!!!! But this is only one person's style. How great we are all different in the way we explore!

But I TOTALLY AGREE WITH YOU, even if a first time homebuyer loves exploring on their own, they need a good agent or real estate attorney to guide them through the intricacies of negotiation and closing.

I think one mistake first-time homebuyers make is not finding an agent who specializes in first time homebuyers.
I think these kind of agents are amazing and worth their weight in gold. They set first-time buyers up for a lifetime of informed real estate decisions and sometimes create realy good R E investors in the process.

So, I agree with Mack, when you're buying your first home, you can't afford to find out, "Gee, we missed that."
1 vote Thank Flag Link Sun Oct 24, 2010
HGTV did a special on the 25 Biggest Real Estate Mistakes. It cover both buyers and sellers, but I will list the buyers mistakes in order on importance as mentioned in the article.

I would add my own personal one that is not on the list, which is NOT buying now while interest rates and prices are low and the selection is high. Do not try to buy at the bottom of the market, nobody knows when that is until it's over. Who knows what interest rates will be then.

1. Buying what you want, not what you need.
2. Overlooking the extra and hidden costs.
3. Buying without a professional inspection.
4. Falling in love with the first property you see.
5. Skipping the loan pre-approval step.
6. Not being pro-active at closing.
7. Visiting the house only once.
8. Not setting a realistic budget.
9. Buying the most expensive house on the block.
10. Trusting everything the real estate advertisment says.
11. Buying without actually seeing the property.
12. Not thinking about resale.
13. Losing money with auctions.
14. Not researching the neighborhood.
15. Buying a house for it's decor.

Using a great buyers agent will help you avoid these mistakes.
Web Reference: http://JimSellsHomes.com
1 vote Thank Flag Link Sun Oct 24, 2010
Trying to go it alone. It always amazes me when 1st time home buyers, who have real estate experience, try to buy homes...especially foreclosures...without a real estate professional. It costs nothing. Why the resistance?
Web Reference: http://www.DesariJabbar.com
1 vote Thank Flag Link Sun Oct 24, 2010
I would say that the biggest mistake is simply not calculating the numbers. Not just for an investment property, even for just buying a home, the buyer should be considering the potential returns on the investment. Otherwise he can buy some property in some place where he won't be able to hardly pay it off.

So I would say, that before buying a house - buyer should use some real estate investment software and run the numbers on various properties, to compare them and choose the same was as an investor would choose.

I am using this free app: http://www.RealEstateAnalysisFREE.com for my real estate analysis, when researching potential investment properties.
0 votes Thank Flag Link Sat Nov 27, 2010
Buying a home for the first time is a HUGE step and for some, may be the biggest financial decision they will ever have to make. Before you buy do your research...not just on the home itself, but on everything that comes with homeownership. Some common mistakes first time buyers make are:

1.Not knowing how much house you can afford.

2. Assuming foreclosures are great deals.

3. Failing to find a good buyer's agent.

4.Underestimating the costs of owning a home.

5. Failing to budget for property taxes.

6. Assuming your first offer will get accepted.

7. Skipping the inspection.

8. Doing too much too fast...(don't make any large purchases that could affect financing!)

9. Not using a Realtor and trying to buy on your own.

10. Forget to set aside funds for emergency repairs.

11. Rely on what everyone else says without doing any research on their own...(lenders, insurance, neighborhoods, how much house to buy, etc.)
0 votes Thank Flag Link Sat Nov 20, 2010
You need to PREQUALIFY first !! It is much easier to get prequalified with your lender and find out what you CAN buy, instead of getting your hopes up on something you can't qualify for, or settling on something you think you can afford only to find out you can afford something much more. Save yourself alot of time and frustration and get prequalified !
0 votes Thank Flag Link Fri Nov 19, 2010
Choosing bad agent. Find information how to avoid it.
0 votes Thank Flag Link Fri Nov 19, 2010
The biggest mistake that I see first time buyers make is trying to buy without the help of an agent. Many first time buyers are so excited to buy, that they just start looking at homes on line or going to open houses but neglect important items such as securing financing. The home buying process presents many challenges, even for those who have bought before, and we advise buyers to find an agent they feel comfortable with and can trust to help guide them through it.
0 votes Thank Flag Link Tue Oct 26, 2010
First time home buyer tips
Are you a first time home buyer? Here are some helpful tips to get you started on the right path.

1. The first step before you do anything is to find out how much money you can borrow from a bank/mortgage company. Check with different lenders to see who can get you the best deal. Once you know what you can afford, then you can begin to plan.

2. Determine what you need in a home, not necessarily what you want in a home. Make a list of those needs to give to your Realtor. When you are searching for homes you will find that it is very rare to find a home that has absolutely everything you are looking for. If you stick to what you actually need, you will have better success in your search.

3. Research areas/communities that are of interest to you. Determine what things are important such as schools, proximity to shopping, restaurants, and local activities. Drive through the communities to get a feel for what they are like.

4. Learn as much as you can about the process of buying a home. Some local Realtors or lenders will offer first time home buying seminars. If you can find one in your local area it would be helpful to attend. If you cannot attend a seminar, look on the Internet for a home buyers guide such as the one at Bankrate.com - http://www.bankrate.com/brm/news/real-estate/BuyerGuide2004/…

5. Select a local Realtor to help you begin your search for a home. You can search Internet sites such as Realtor.com or Homes.com, but a Realtor has access to all of the homes in the local MLS. They can provide you with information on the home, the area and answer any questions you may have. A Realtor can show you properties of interest.

6. Learn about the contract and what is involved. Your Realtor can take you through step by step the process of a contract. After it is signed by buyer and seller, it is called an executed contract. Then you would want to get a home inspection. If everything is fine with the inspection, then you can go forward towards closing.

7. Know what happens at closing. Again, a Realtor can walk you through what to expect at closing. You will need to have money for closing costs such as title search, processing fees, taxes, and insurance.

Buying your first home is an exciting and overwhelming experience. So make sure you are prepared.

Tammy Hayes, Realtor, Sandals Realty, Punta Gorda, FL tammyhayesre@gmail.com
0 votes Thank Flag Link Tue Oct 26, 2010
Trent,
As you are the expert on lending and most Realtors know our clients should see you first, I'm going to answer your question as it pertains to actually buying a home.

I recently wrote about the Top 5 Mistakes Intelligent Buyers Make and How to Avoid Them. I believe these same errors pertain to first timers' as well.

Mistake #1 – Making a low-ball offer to see how low a seller will go.
This never works. Let me repeat myself, low-ball offers never work. Going around town making low-ball offers only upsets sellers and eventually you become know as, “that guy who makes low-ball offers on everything in town.” Don’t get me wrong, this is a buyer’s market and you can and should make offers lower than the asking price that may be considered by the seller. To avoid going too low, study the recent comparable sales in the last 3 months (six if nothing much has sold) along with the average percentage below (or above) asking price that most homes are selling for in that neighborhood. This percentage is available to your Realtor through the local MLS. Remember low-ball offers just piss off the seller and are usually not even countered.

Mistake #2 – Thinking foreclosures or short sales are better deals and ignoring standard sales.
Standard real estate sales, the ones that are not distressed sales, can often be the best deals in a community. The short sale you may think is so great may not be. After six months of waiting the bank could come back with a higher price than a standard home is priced right now. Also, a foreclosure being sold “as-is” may have significant repair damage to make it livable. These costs could bring your great foreclosure deal to a higher overall price than the standard home for sale next door. Weigh all your options before proceeding.

Mistake #3 – Saying too much to the seller. (Scott put this well below)
When we take a buyer to a home we always try to make sure the seller is not home. Often a buyer will think they are helping their future negotiations by spouting off to the seller about all the things they will need to fix before they can “live” in this home. This only offends the seller and makes them less likely to ever want to sell the home to such a rude buyer. If items in the home need to be updated or replaced this can be relayed in a tactful way between Realtors. Respect a persons home as you would want yours respected.

Mistake #4 – Missing hidden defects before closing.
This is one of the most expensive mistakes any homebuyers can make. Every home should be professionally inspected regardless of whether it’s sold as-is or it’s brand new. At White Sands Realty, we recommend to our Naples home buyers that they have the major home inspection done by a professional like House Master as well as extra inspections like mold, radon, pool equipment and termite. $350 to $900 in inspection costs is nothing compared to the hundreds of thousands our buyers have saved in future repairs and headaches. Inspections are not something any home buyer should skimp on.

Mistake #5 – Wanting a “great deal” but falling in love with one home.
Every buyer today wants that one-in-a-million deal on a home. It’s a buyer’s market and why not? The mistake made is not that you want a great deal, it’s that you have to be open to offering on 2 or 3 homes before you get that really great deal. Falling in love emotionally with a single home makes you depressed and leaves you with nothing when your offer is rejected. Instead, we recommend narrowing your search to three homes that you’ll love if you get that great deal. If the first one doesn’t work out, then you have plan b and c to fall back on. This prevents you from busting your budget and takes some of the emotion out of the purchase.
0 votes Thank Flag Link Mon Oct 25, 2010
One of the commonly overlooked issues for "first time home buyers" is the importance of having established and good credit. One of the frequently asked questions on this forum is," My credit score is 575...can I buy a house?"

The home purchase process, in most cases begins many years prior to making the decision........an concept that many cannot grasp!

Bill
0 votes Thank Flag Link Mon Oct 25, 2010
Trent, first time home buyers have been known to make a lot of mistakes in their purchases. It looks like some really good answers have been posted to this. We've put together a list of just 10 of the most common mistakes first time home buyers make. This is really great information. See it at http://www.meadowsteam.com/How_To_Buy_Your_First_Home
0 votes Thank Flag Link Mon Oct 25, 2010
Hi Trent. Buying a home is emotional for most first-timers, unfortunately. It should be strictly a business decision, just like buying an insurance policy. But it's not. For me, I've find myself constantly coaching prospective buyers on not showing emotion during the process, neither to the seller's agent nor the owners themselves.

Buying a house right is an art form. I've done plenty of them for myself in my life before I did this for others. It's all about strategy, timing and information. If I have clients that are complementing every home we walk into (out loud with smiles), time for me to have a talk with them again. Buying a house is a business transaction and should be treated this way or you wind up overpaying. Never fall in love with a home. There's always another deal right around the corner.

Scott Miller, Realty Associates, Boca Raton, FL
0 votes Thank Flag Link Mon Oct 25, 2010
Buyers make the mistake of guessing at how much they can afford. They dive into the house hunt using online calculators to estimate how much they can afford then get a dash of coldwater when the lender doesn't qualify them. The loan process is a lot more intense now than ever. Bank's are paying a lot closer attention to loan applications and credit now.
0 votes Thank Flag Link Mon Oct 25, 2010
Desari is right. The number one biggest mistake is going it alone, without a good agent.

Ever travel? Are you the kind of person that likes to go overseas, and explore on your own? Really? Ready for a safari without a guide? Forget the wild, what about the cities - ever do a few days someplace, come home, look through the guidebook, and say, gee - we missed that?

When you're buying your first home, you can't afford to find out, "Gee, we missed that."

Get a guide.
0 votes Thank Flag Link Sun Oct 24, 2010
Not getting prequailified BEFORE starting to look for a house is often teh biggest mistake that can be solved by simply meeting with a local and trusted mortgage brioker or loan officer than can prequailify a buyer at no cost. This tells them if they can obtain a mortgage and what price price range they should be looking in

Please see my blog for tips on obtaining a mortgage in todays market.
0 votes Thank Flag Link Sun Oct 24, 2010
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer