Common Home Buying Mistakes
Top 5 Common Home Buyer Mistakes
Mistake #1 -- Not understanding the listing agent represents the seller.
We get calls all the time where buyers want to schedule a showing and they don't understand the listing agent represents the home seller. 85% of home buyers are working with a buyer's agent because this gives the buyer representation in the home buying process. This makes in sense in most cases, especially considering the buyer's agent commission is already factored into the price home buyers see on all listed homes. With a listing agent representing the seller, it's logical that you'd want a buyer's agent leveling the playing field when you are buying a home. Buyers that don't have a buyer's agent representing them don't get a better deal on the home, the listing agent would keep the entire real estate commission in the scenario where a buyer doesn't have a buyer's agent. The listing commission gets set when a home is listed and if there is no buyer's agent to cooperate the commission with (i.e. no agent assisting the buyer) then a listing agent would keep the entire commission for working both sides of the transaction (in this scenario a buyer is not being represented by an agent). In today's real estate market, there's every reason to have a buyer's agent helping you with your home purchase.
Mistake #2 -- Finding a great home before being ready to purchase.
Buyers sometimes put the cart before the horse and want to see homes when they're months from being ready to buy. Few real estate agents have time to show homes that a buyer really can't purchase. Agents with no business may be willing to show homes under this scenario but the representation a buyer receives will be reflective and in reality agents who show homes to buyers who aren't ready to purchase a home don't last long in the business. Be aware that few home sellers will accept a closing date that is more than 60 days out, so if you're further out from being ready to buy a home it's probably too early to start the home search. Not to be confused with actually starting a home search, it could make sense in some cases to get out a time or two early in the process just so a buyer can get a good idea of what's available in the marketplace and in their price range.
Mistake #3 -- Letting emotions affect the outcome.
In a perfect world a buyer would never get emotional over a financial decision. But this is the real world and buyers do get emotional at times, some more than others. In any case, a great real estate agent will be skilled at helping reduce the emotional affect a buyer may experience. At the very least, a buyer's agent will be there to handle all communication between the buyer and seller (or listing agent). It's understood that we're talking about what will be the buyer's new home and there may be family changes and financial stresses involved. It's a lot to process and a buyer's agent can really help reduce the emotional effect for a buyer. Keeping some distance between the buyer and seller and keeping everyone focused on the ultimate goal is one of the greatest attributes of a buyer's agent.
Mistake #4 -- Falling in love with a home in a poor location.
Location has always been, and will always be, a most critical aspect in determining a home's value. A home can be fixed up but it can't be moved. Location can mean a specific city or home community or it could mean an actual lot within a given home community. As a general rule, if half of home buyers would pass the home up due to its location, you should question looking any further at the home if you can't purchase the home for well below similar comparable homes on better lots in the area. When doing a preliminary search online, home buyers are advised to look at the online maps that are made available to see where a home is situated. If the home backs to a street, many home buyers will mark the home off their list and there's no point scheduling a showing on a home that simply won't work. Types of questionable locations to look closely at are homes backing to a street, backing to power lines, located on busy through streets, located next to commercial zoning, etc.
Mistake #5 -- Winning the battle but losing the war in negotiations.
Negotiations can be tricky and, while we've seen many twists and turns, every real estate transaction varies. Negotiating skills are learned over time and through experiences and you'll want a real estate agent who knows how to control the negotiation process to help you achieve your goals. A great agent will collaborate with the home buyer to arrive at the best strategy that has the best chance of furthering the buyer's position. In most cases, home buyers should avoid dwelling on the small things and instead keep their focus on the big picture. There's more to negotiating a real estate deal than just the price involved. For many buyers and sellers, there are other factors just as important, such as the close date, timing of possession, timing of repairs, timing of a related purchase or sale, etc., and a buyer's agent can help a buyer win the war.
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