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Home buying: Mistakes and pitfalls to avoid




Home buying: Mistakes and pitfalls to avoid

Buying a home is a big step and it is important that once you have decided to do it, to pay attention to certain details to avoid any pitfalls. In addition, you should be prepared that the process for buying a property can last from two months, if you are lucky, up to 1 year. During this time, you will see many properties and be faced with many dilemmas and decisions to make. Therefore, before starting the property search, it would be good to determine your needs today but also to anticipate your future ones (for example if you plan to grow your family). We will present you five mistakes that are very often made by those looking for a new home... to avoid.

You have not specified the budget you want to allocate

This is the first question to answer! If you don't know or are undecided about the capital you want to allocate, you are most likely wasting your time. Whether you're buying a home with a bank loan or paying down the whole amount, you need to set a maximum amount so you don't accidentally look at properties you can't buy. In case of a mortgage loan, before proceeding to submit the application, decide what is the amount of the monthly installment you can pay, the terms of the loan and of course the interest rates. If you are going to buy a home with a down payment, it would be wise not to spend all of your savings. It is important to keep an amount "on the side" as no one knows what may come in the future.

Calculate the cost of the renovation

If the house you plan to buy is not newly built or fully renovated, then you will definitely need to factor in an amount for repairs and renovations. The cost of renovating your future home can put you off the financial track, therefore before signing the contracts, seek the advice of specialist contractors for any repairs. Ask for financial offers for the work and thus you will get a clear picture of the total amount of investment that the specific property requires.

The home loan alternative

Bank loans had been blocked in recent years due to the economic crisis, however, today the loan applications have opened for those who wish to obtain a loan, specifically a mortgage loan. If, in fact, your purchase concerns a first residence, find out about the favorable terms of the mortgage loans provided by the banks. In general, banks lend at fairly low interest rates, compared to the pre-crisis period, and often the interest does not exceed 3% of your capital. In any case, before proceeding with such a decision, you should have made a financial budget and carefully studied your income-expenses.

Is the price negotiable?

Your basic principle when looking to buy a property should be that the price is not negotiable, although in many cases this flexibility exists. However, don't assume that all homeonwers are selling out of necessity and driving down prices. In general, you should bear in mind that when a property costs less than the usual market prices, this may be due either to the seller's rush to liquidate or to the fact that it is "problematic" (planning arbitrariness, composition pitfalls, debts of the seller, etc.).

When a property is reasonably priced, you can study your negotiation strategy. Before you proceed with your offer, consult your property consultant about negotiation margins. If the property qualifies and you are really interested, try to be diplomatic in the negotiation process so that you don't lose it but at the same time don't go beyond your initial financial budget. However, there are properties more expensive than the market average. Before you proceed to negotiate an expensive property, think about the reasons the owner has chosen that price. Many owners are in no rush to sell, but want to appraise their property by asking a high amount.

You are avoiding the real estate agency

Searching for properties directly from owners is quite difficult, time-consuming and usually leads to a dead end as most properties on advertising platforms are posted by real estate agencies. When you search for properties only by owners you lose valuable time as 90% of the properties offered are represented by real estate agencies. A typical brokerage fee is 2% (plus VAT) of the buyer's price and by paying this amount you get access to a wide range of properties, your property visits are better organized and communication with the seller is coordinated and you get valuable help with the paperwork process.

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