Updated: Apr 6
You may be overwhelmed with emotions when buying a new home, but don’t let that get in the way of your home buying decision. It is not uncommon for people to make mistakes when their thoughts are clouded by their feelings, and this applies in home buying too. Here are six things you will not want to do when buying a new home:
Underestimating the Full Cost
The downpayment of a home and monthly loan servicing amount are two of the costs prioritized by homebuyers. However, do not forget to factor in additional costs such as the buyer stamp duty, legal fees, and valuation report fees. Fees such as property taxes and a mortgage protection plan (to insure your home against natural disasters or incidents) are also not to be left out. Last but not least, keep in mind that funds are required for home maintenance fees as well. To sum it up, don’t underestimate upfront costs or ignore hidden ones.
Not Getting Your Loan Pre-Approved
One of the most common mistakes is not getting an in-principle approval (IPA) for your mortgage before you make an offer for a property. An IPA functions as an agreement that the bank will grant the borrower(s) a mortgage loan when they need it. This is usually when the buyer has secured themselves a unit by paying the option fee. Depending on the bank, an IPA is valid for a period between 14 to 30 days. It is always important to get your IPA done, so you do not meet with a situation where you are unable to take up a loan after you placed an option fee, which usually aren’t refundable.
Buying Based On Emotions
Saw a home that you really like the design of and immediately fell in love? Don’t be impulsive and let that be the deciding factor. Take note of your other requirements such as ease of accessibility to public transportation, traffic in the area and so on. Does this home satisfy all your other needs such as space or functionality? Be rational in your decision making instead of letting the curb appeal of a property influence your choice. Putting your needs first will save you a lot of hassle down the road.
Deciding Based On Price
Similar to buying based on emotions, don’t let price be the sole deciding factor in your decision of a new home. In most cases, you get what you pay for, so the cheapest option is not always the best one. There are also cases where the price is too good to be true, so there is likely to be a catch somewhere. Compare recent asking and selling prices of similar properties in the same area to get an understanding of how much a property is worth.
Not Checking For Defects
Conduct a thorough inspection of the property before you make your decision. It is important to not only detect defects that can be seen with the naked eye, but to also suss out potential issues such as water seepage or pest infestation problems. You wouldn’t want to buy a home only to discover the issues lying within it, so make sure to note them down before you buy.
Not Getting a Professional to Do the Job
Having the assistance of a qualified real estate agent can be valuable in so many ways. From fetching you the best price and value to identifying and noticing issues you might not, you will not lose out. Check out our article on why it is important to engage an experienced real estate agent here: https://www.propertyhunter.com.sg/post/the-importance-of-having-a-real-estate-agent
It is best to take note of all these critical factors when buying a home. It will not be a simple recovery should you fall victim to any of these situations that are easily overlooked. Don’t hesitate to reach out to us should you have more questions!