n part one of this article you are waiting for a severe
I discussed critical correction in real estate prices,
mistakes 1 through 5: pull up a seat, because you might
be waiting a long time.
1.Using and out of town lender.
Homes, unlike other investments
2.Not getting a loan approval (the stock market for example)
letter before writing and offer are valuable in two ways: 1)
on a home. Psychological value - homes have
value because everyone thinks
3.Buying too much house for your they should, and 2) “real” value
income. (people, homeowners and renters,
need shelter).
4.Thinking short-term in regards
to how long you will own your Because homes are valuable in
home before selling it. both respects, home values
historically will usually only
5.Using 1031 exchange money to level out after a hot market.
purchase a personal home. Sometimes homes will lose some
value but not very much. St.
Now for the “Top 10 critical George homes lost about 5% of
mistakes home homebuyers make and their value after the last hot
how to avoid them”, 6 though 10: market in 1995…sort of like a
balloon deflating because it took
6.Waiting for the “bubble” to several years for this to happen.
burst.
Hot markets come and go. Cold If I were looking to buy a home I
markets come and go. Markets would be more concerned with
become over-priced, then interest rates and less concerned
over-time become under-valued. If with playing with bubbles.
miss.
7.Not choosing an agent
carefully. I have seen all of these items
In our town about 75% of real missed by a potential homebuyer,
estate agents have been in the but caught by a home inspector:
business one year or less. I a.A dryer vent, venting into the
suspect that this is true attic
nationwide. The hot market of b.A ground fault interrupt
2005 caused everybody and their breaker not working (this can
brother to want to get their real kill you!).
estate license. When you contact c.Evidence of termites
a local agent, you probably have d.Aluminum wiring
a 3 out of 4 chance of getting an e.A roof leaking into the attic,
agent who is severely but not into the main part of the
under-qualified to represent you home (yet!).
in the purchase of $250,000+
investment…your home. Several years ago I became aware
You’ll want to contact at least of a transaction in our real
four agents to make sure you are estate office where the buyers
getting the best one you can decided not to have a
find. Ask questions and then professional inspection on an
trust your instincts as to which almost new home they were buying.
agent is the best one for you. They “inspected it themselves” to
save the $300. Too bad they
8.Not having a home inspection didn’t catch the fact that some
done by a Professional Home of the basement windows leaked
Inspector. badly when it rained. The water
A good, experienced Home stains were clearly visible had
Inspector will catch problems in they known to look. That turned
a home that most homebuyers would out to be a huge mess involving
lawyers, threats and grief. This
could have been avoided by paying Lesson learned, always get a home
the $300 to have a Professional warranty you buy a new home, even
Home Inspection. if you have to pay for it. It is
money well spent. I would never
9.Not receiving a home warranty buy a home without purchasing a
at closing. home warranty. I never sell my
It’s 3:00 AM. You wake up hearing own properties without a warranty
water running in your newly for the buyer. It just makes good
purchased home. It keeps running. sense
And running. You get up to check
it out and find your basement 10.Not meeting the neighbors
floor covered with water from the before you make an offer.
broken water heater. Luckily the Don’t you really hate it when
damage from the water is minimal. your neighbors suck? Don’t you
You go to look for the Home think it would be a good idea to
Warranty confirmation in the do a little door knocking before
documents you received when you you buy your new home? How about
bought your home the previous going online to look at your
month. You know that the home state’s website for registered
warranty company will replace sex offenders?
your broken water heater for only
$55. Suddenly, you slap your hand I did a little door knocking
to your forehead and make the before I bought a foreclosed home
Homer Simpson “Douhhh” sound as in St. George. I was buying the
you realize that you didn’t get a home for my personal use and as
home warranty because the seller part of the “due-diligence” I
wouldn’t pay for it and you decide to meet the neighbors. I
certainly didn’t want to pay for asked which house was the “bad
it. house” on the street. I came to
find out it was the home I was keep yourself, as a homebuyer,
buying because the previous out of hot water. Violate any of
owners were noisy, rude, dirty, these steps and you may end up
and didn’t care for their home. I losing a little or a lot of your
changed that by buying the home hard earned money. Now go out and
and moving into it. find the home of your dreams!
There you go; 10 simple steps to
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