Top 6 things home buyers forget during their house hunt: are you missing these too?
No matter how carefully home buyers do their homework, certain tasks on the home-buying to-do list often fall through the cracks. And not tiny ones, either! We’re talking about things home buyers forget that can lead to major money down the drain, battles with local government or the homeowners association, and other regret-filled dramas that could have been easily avoided—that is, had home buyers known where these issues were hiding a bit earlier.
Don’t let this happen to you! Here are the top 6 things home buyers forget most often during their house hunt:
Oversight No. 1: Considering the home’s resale value
Sure, you’re buying a home. And yet, you must think like a seller.
Few buyers actually stay in their home for decades. When visiting listings, buyers should talk to their real estate agent about trends in the neighborhood and the likelihood that the home would sell for the same amount in two years, five years, or 10 years down the road.
Buying a home should make financial sense now, but if circumstances make this home no longer the right one within a few years, you don’t want to be in a tricky financial situation while trying to sell. Stick to properties with broad appeal rather than quirks that appeal only to a rare few, like a kitchen in the basement or brightly colored bathroom tiles.
Oversight No. 2: Factoring in the expenses you’ll face after you buy
People focus so much on mortgage payments and closing costs, but what they don’t realize until after the fact is that there are expenses like oil or propane and landscaping that are built into home ownership. To make sure the bottom line will be within your means, home buyers should ask sellers for a property expense list to get a better gauge of what they’ll be paying each month. Then, consider the reserve that you’ll need for typical maintenance. Rule of thumb: Plan on setting aside 1% of the home’s total value annually for upkeep and repairs.
Oversight No. 3: Rooting out any restrictions
All too often buyers learn the hard way that their property comes with restrictions. Say, they can’t park wherever they want, or they discover their house is within a historic district that prohibits renovations or additions to a home.
Buyers will need to check with the city, review the preliminary title report, and seller disclosures. For good reason: Once you become the owner, any restorations fall on you. Zoning, title issues, or covenants go with the property, not the seller.
Oversight No. 4: Checking that past work was up to code
The seller is responsible for disclosing any renovations, non-permitted work, and items not up to code. But just as things aren’t always done to the letter, sellers aren’t always totally honest about what’s been changed—or how. That’s why buyers need to check any and all past permits to make sure that the work was done and signed off on by the local municipality.
Why is that such a big deal? Consider this: if it was done improperly, or not to code, you may have to tear it out and start all over again.
Oversight No. 5: Getting the scoop on the HOA
Never close on a home without doing serious due diligence on the homeowners association. While HOAs are ideally supportive and make living in a community convenient, there have been reports of a few cases where homeowners have clashed.
Also, find out if there are a lot of delinquent homeowners in the neighborhood because if there is an upcoming assessment, or there are delinquent homeowners, the HOA and you will have to cough up the money to cover it.
Oversight No. 6: Doing your homework on the neighborhood
Crime rates, school rankings, and traffic patterns, oh my! The home itself is just one aspect of what makes a property a good buy. Buyers often forget that the neighborhood should be inspected as much as the property. Shoppers should walk their block at different times of the day and talk to neighbors to get a better feel. After all, the house may be gorgeous, but if you’re unhappy with your neighbors or the overall environment outside your door, it probably isn’t the right place for you.
Sources: “4 common homebuyer oversights,” Florida Realtors; “6 Top Things Home Buyers Forget to Do: Did You Miss Them Too?,” realtor.com