The 5 Most Costly First Time Home Buyer Mistakes

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first time buyer sign

As a first time home buyer, you likely have many questions about what to expect in the upcoming months.

Many first time buyers will get caught up in the process and jump in with both feet, only to make mistakes that can end up costing them thousands of dollars.

As you consider your options and start looking for homes, be cautious to avoid these common first time home buyer mistakes:

1. Buying Too Small

Your first home is your “starter” home, so that means you can simply buy that two-bedroom, one-bath and move out of the apartment.

Not necessarily.

Many first-time buyers forget to consider their future needs in addition to their current needs, and end up buying a home they will outgrow in just a couple of years.

You never know what the future will bring or what the market (and your finances) will do, so make sure the home could meet your needs for a while.

2. Not Planning a Budget

Before you start shopping, make sure you know what you can afford to buy.

Unfortunately, banks are not always careful to offer a fair amount. Just because the bank says you can afford a $100,000 house does not mean that your budget can afford the mortgage on a $100,000 house.

Crunch the numbers, and remember that utilities, insurance and taxes need to be accounted for when planning a budget. Once you know your limit, stick to it.

3. Getting Emotionally Attached

Buying your first home is exciting! It is a process filled with many emotional hills, and many “mountaintop” experiences. When you find “the one,” it’s easy to fall head over heels in love with it, but that emotional attachment can cloud your judgment.

You need to move forward with the home buying process with reality in mind, and getting emotionally attached will make you overlook serious problems in the home.

4. Failing to See Potential

While you don’t want to overlook serious flaws in the home, like a cracked foundation, you may be able to get a true bargain if you can overlook cosmetic issues.

Homes that have horrid wallpaper in the bathroom, but plenty of space in the kitchen, can be easily transformed into your dream home. After all, chances are even the well-painted home is not going to have colors you love, so you will be painting no matter what color the home has to begin with.

Find a home with potential, and you might be able to get more for your money.

5. Making the Wrong Compromises

Buying a home is all about compromises, but be careful that you do not make the wrong ones. Compromise on things like the size of the yard, not crucial features like the number of bedrooms.

Make a list of your “must haves,” and then try to stick with that, if your budget allows, as much as possible while you shop.

The world of home buying for the first time is both exhilarating and terrifying.

Position yourself for success in this endeavor by avoiding these common first time home buyer mistakes. Soon you will have a home that you love and that will fit your needs well for many years.