Even the current health crisis hasn’t put a damper on today’s housing market. Mortgage rates are at record lows, and housing affordability is high. More renters are recognizing they can get a better deal by buying their first home and beginning to build their investment.
In fact, it’s more affordable to purchase a house today than at any time in the past seven years.
The process can be easy when you go into homebuying with both eyes open. Do your research and ask for advice. Dig into the mishaps of other homebuyers, while you’re at it: It’s not just entertaining. It can help you see where pricey problems can be avoided.
12 times homebuying went terribly wrong for first-timers
When buying a house, what’s the worst that could happen? Here are a few frightening examples:
1. Buying a property “as-is.”
“Had it inspected, checked out the basement for leaks, asked the homeowner about potential leaks, asked the inspector. Bought the house ‘as-is’ (discounted) on their word and the assessment. One month after moving in, the basement flooded 4″ high on the first real rainstorm. It took me four years and thousands of dollars and time and stress to fix it.” – lostintransactions
2. Falling in love too fast.
“I was excited to have my offer accepted on a home I loved. However, the inspection came back showing significant roof damage. The seller wasn’t willing to cover it or budge on price, so I had to back out and lost money on the inspection, as well as the $1,000 I put down. I did end up in a house with no major issues for a great price that made up for it!” – Jesse, MyRoofingPal
3. Forgetting to check the property taxes.
“When I bought my first house, the taxes increased by $2,400 a year compared to the prior owners’. I wasn’t prepared for that $200/mo increase. If the prior owners owned the home for a significant amount of time, the taxes will be recalculated on the market value you buy the home at, and your taxes may increase once that adjustment happens.“ – RelevantStandard
4. Getting taken advantage of by the seller.
“When my wife and I bought our first home, the seller/agency failed to disclose there was major termite damage to the attic. When we did the appraisal, the person they hired was even planning to skip it until we insisted they appraise everything. The issue was obviously discovered. We rescinded our offer and intent to buy and reported the agency.” – Dan, WikiLawn
5. Just visiting it once.
“I visited the property one time with the realtor during a weekend afternoon. It seemed like a good match, and I got it. I soon realized how noisy it was. The morning traffic saw tons of heavy vehicles that delivered a low rumbling sound. It lasted till noon and then started again in the evening. It was so annoying I had to spend $5,000 to soundproof!” – Albert, Home Living Lab
6. Looking at the low-end of your price range.
“I wish I’d bought a more expensive, newer house. Not having cockroaches inside would make it worth it alone, but also having better energy efficiency and nicer decor and fixtures would have been quite nice. The price gap was only around $30K too.” – hutacars
7. Neglecting to pull the permits.
“We bought from a flipper after the owner passed, a 1950s Cape Cod where he finished the attic to add a fourth bedroom and second full bath. On Christmas, I clogged the sink. We survived and had a plumber coming. We never made it that far as the contents of our upstairs bathroom ended up in the kitchen. None of the upstairs addition was permitted.” – Jim, AJ Property Buyers
8. Not vetting your inspector.
“It wasn’t until after I purchased did I realize our (recommended) inspector missed several items. Evidently, there had been a fire in the house at one point; there were several wiring and plumbing issues. Most windows didn’t open or close, nor was the house well-insulated. We knew some things needed repaired but not to the level it ended up being.” – Melanie, Creo Home Buyers
“As part of the prequalification process, we uncovered credit theft, and Nader [at Cornerstone] guided us down the right path to resolution so we could get back on track quickly.” – Click here to connect with a loan officer who pays attention to every little detail.
9. Paying way too much for utilities.
“My first house was in Central Texas. It had an upstairs attic converted into a spare room. Then… summer came. I don’t think my AC unit ever turned off trying to keep the house cool with that converted attic. I have fond memories there, but the $400-a-month electric bill when I was on a budget wasn’t one of them.” – fLeXaN_tExAn
10. Underestimating the cost of renovation.
“My first house I bought with my wife was a duplex in 2009, right after the Great Recession. It had been flipped quick. We had an annual salary of $23,000 and very little in savings. In the first year, we spent $12,000 on fixing things that the flippers had just covered up, done poorly, or not done at all.” – Seth, SethBuysHouses
11. Overlooking stumps and trees.
“When we bought our house, there was an old stump about 6′ from our garage. A few months after moving in, the garage floor started cracking, and puddles of water began forming, especially after rain. It turns out the stump’s roots were forcing the concrete up! So, we not only had to replace the garage floor, we had to pay to have the stump removed.” – Jeneva, The House Wire
12. Walking into a closing-day disaster.
“We did our final walkthrough to find the house full of dirty furniture, rotting food, old broken cabinets, empty paint cans, dog feces, and sewing needles stuck in the carpets. The seller had moved out of state and had no intention of coming back. Our agent withheld $5,000 from closing in escrow, and the seller’s agent arranged to have the house hauled out.” – MrsKlein31
Make a smooth move before your next rent hike
Rents have been rising year-over-year since 2012.* With rates at record lows, now’s the time to lock in a stable housing payment as you build your wealth at the same time. Get connected with a local loan officer who knows exactly what kind of pitfalls first-time homebuyers face — and who can help you stay protected.
*”Apartment List National Rent Report,” June 2020.