Five Costly Home Buying Mistakes to Avoid

Five Costly Home Buying Mistakes to Avoid

If you're considering purchasing a home, here are some common mistakes that can be expensive to make.

1. Underestimating Your Budget
One of the most significant errors prospective homebuyers make is underestimating their budget. Whether buying a primary residence or a fixer-upper, people often overlook the total costs, especially those planning to renovate and sell for a profit. It is essential to add a 20% cushion to your budget and obtain multiple bids before committing to anything to avoid financial strain.

2. Paying Contractors Without Proper Vetting
It’s crucial to be cautious when selecting contractors. Choosing the first person who provides a reasonable bid can lead to problems. Thoroughly vet any contractor by checking their online reviews or ratings, understanding their location, and ensuring their legitimacy. This due diligence can prevent the loss of money to unreliable contractors.

3.Knowing Your Design Theme
When fixing up a home for personal use or resale, having a clear design theme is important. Without it, you could spend excessive time and money on a project that lacks cohesion or doesn’t meet your expectations. Following current trends can help make your home more appealing to potential buyers if you are doing a quick flip.

4. Avoiding Over Improvement or Under Improvement
Falling in love with your first home project can lead to over-improvement or under-improvement. Over-improvement involves making excessive changes that can become a money pit, while under-improvement means doing too little to see a significant return. Research the neighborhood to understand popular improvements and check sites like Zillow to see the features prominently listed in similar homes.

5. Not Giving Contractors Too Much Leeway
Avoid giving contractors too much control over design elements. Contractors might not always choose the best materials or have the best ideas for your project. Verifying the materials used and keeping control over the project's direction can prevent bad and expensive decisions. Also, avoid giving contractors more than a 25% deposit upfront to reduce the risk of them taking off with your money.