Recent Home Buyers In Too Big Of A Rush Now Living With Buyer Remorse
"It was unlike any home buying activity I have ever seen," stated Robert Lowry of Dr Cash Home Buyers in Philadelphia. "It was a like a feeding frenzy. Potential home buyers in Philadelphia were so eager to visit homes for sale and submit written purchase offers that they often disregarded their buying criteria. Many of them were participating in bidding wars that drove home prices in Philadelphia to historical highs."
According to various surveys 52% of all home buyers experience some form of buyer remorse and overall 25% said they were unhappy with their decision. Roughly a third of all home buyers said they purchased homes with less square footage than they wanted and an equal number said they expanded the acceptable search area to purchase a house. And, roughly one third said they accelerated their plans for a house purchase in Philadelphia due to the fear that home prices and mortgage interest rates would continue to climb.
What Are The Most Common Mistakes That Home Buyers Make?
Poor Financial Planning
Large Future Expenses
This mistake covers a lot of ground starting with family planning several years into the future. Big future expenses such as car purchases should be part of the financial plan. And there should be a "buffer" amount equal to at least two months income for unexpected expenses.
Failure To Understand All Costs of A Home Purchase
- Down Payment - the average house down payment for first-time buyers is 6%; repeat-buyers average 13%
- Moving Expenses
- HOA - transfer fee
- Property Taxes - begin the day of title transfer
- Mortgage Insurance - private mortgage insurance to protect the lender
- Closing Costs - loan application fees, home appraisal, survey, credit reporting fees, home insurance, loan origination fee, pest inspection, lead paint inspection, property inspector, attorney fees, wire fees
Waiving A Home Inspection
Not a good decision. Home Inspectors are professionals and know far more about the construction and condition of a home than the average home owner. They can discover current and future areas of the home that need repair. Undiscovered and needed repairs could cost the home buyer tens of thousands of dollars, especially if they involve the foundation, roof, plumbing, HVAC, or electrical systems.
Failure To Research Mortgage Providers And Get Pre-Approval
One of the biggest failure points in a home purchase in Philadelphia is the buyer's inability to qualify for a loan. If potential home buyers are pre-approved then they have a negotiating advantage over other potential buyers needing a mortgage.
Not Researching The Neighborhood
There is a lot of information online that can help potential home buyers in Philadelphia. Police reports and crime statistics are online and there are neighborhood Facebook groups. Nextdoor is another source of neighborhood information. School ratings are also online. And it is a good idea to note the businesses such as groceries, restaurants, medical, and entertainment that are easily accessible.
Rushing Into A Bidding War
No house is perfect including those that are purchased far above their asking price in bidding wars. It is important for potential home buyers to control their emotions and not be seduced by FOMO - the fear of missing out. House buyers on tighter budgets may not qualify for a mortgage when a house is bid above its appraised value. And house sellers will be more inclined to sell to those who have larger down payments and need smaller mortgages.
Why Do People Regret Buying Homes?
- Overpaid For The House
- Neighborhood Issues
- Long Commute To Work
- Higher Than Expected Maintenance Costs
- High Property Taxes
- Layout Of House
Is It OK To Buy A House That Needs Work?
Yes, but at the right price. And there are many pitfalls when rehabbing, remodeling, or repairing major items in a house. Typically this is the area of a residential house investor or professional home buyers company in Philadelphia. Ask for referrals of contractors. Multiple contractors should be researched and at least two should be providing an estimate of the work to be done. The lowest bid is not always the best.
Dr Cash Home Buyers is a home buyers company in Philadelphia that purchases houses in any condition with 100% cash. Home sellers avoid repairs, showings, commissions, fees, and a ton of headaches. Many of the houses are upgraded and remodeled and return to the housing stock as a rental or retail sale.
