Toronto Real Estate Lessons: What I should have done…

In: Real Estate News

26 Jul 2011

When most people buy a home, they generally need to make compromises. Many people need to work within their budget and this forces them to decide between different neighbourhoods, different styles of homes, new kitchen, old kitchen, 3 bedrooms, 4 bedrooms. Unless you are a millionaire that can buy whatever you want, then you will need to make compromises when you buy a home.

However, some of those compromises might turn into regrets. They say that “hind-sight is always 20-20″, which means that it’s easy to see what you should have done when you look back at your choices. Here are a look a the top 4 regrets or compromises that people make when it comes to home ownership.

1. Buying in the wrong location:

Location is the most important factor in real estate prices. However, the most desired neighbourhoods seem to always be just out of range: A little too expensive. Sometimes people can afford a good neighbourhood, but they choose a less popular location because they can buy a bigger house. These less popular locations often turn into regrets. Perhaps a buyer could have lived in the heart of Mississauga, but choose a larger home on the outskirts of Brampton. Soon the hassle of commuting longer to work and amenities, lower ranked schools, and slow rising real estate values that come with choosing a poor location, turn into regrets of buying in a less desirable location.

2. Not Buying A Big Enough Property:

Again, the size of the property is often a factor of budget. However sometimes, quick decisions and not thinking ahead, result in regret when it comes to the size of the home purchased. People often buy a 2 bedroom home or a 2 bedroom condo without considering that they will be growing their family in the next few years. They jump into home ownership right after marriage, buy a 2 bedroom, and then need to move in 2-3 years because they run out of room. Often a 3 bedroom is about $50,000 more than a 2 bedroom. This can seem like a lot of money at the time, but buying and selling also come at a cost. $50,000 can easily be spent in closing costs, moving costs, and realtor fees. It is often better to buy a slightly bigger home, one that will accommodate your lifestyle for the next 5-10 years, instead of buying smaller to save $50,000.

3. Not taking a bigger role when buying or selling a home.

Many people think that they can just pass all responsibility of pricing, negotiating, and buying and selling to their agent. Big mistake. Agents make money when the home buys or sells. Sure they want to protect their client’s interest, but you, as the buyer or seller, needs to be really involved in all aspects. If you are buying a home and your agent provides you with 3 comparables, ask for 100! No joke. Ask for EVERY home that has sold in the last 5 years. Your agent can provide you with this information, but they often don’t. Don’t you want to know home much home prices have increased? Don’t you want to see all homes and do your own research? Often people buy a home, and then find out other prices. They come to the conclusion that they overpaid, and they blame their real estate agent. You should blame yourself for being lazy. How can you put all your trust into an agent who gets paid if you buy, whenever you buy, whatever you buy. This “real estate agent regret” is typically blamed on the agent, but it’s safe to say that it’s usually the fault of the buyer or seller.

4. Buying a “Fixer Upper” instead of paying for a “move-right-in” house.

Sure fixer uppers are less expensive. Sure you can rationalize the decision by saying “we get to make our own renos instead of paying for someone else’s. But often people take on more than they can choo when they buy a fixer upper. The costs, time, and hassle can create a strain on the family that is really not worth it. If you ask most people who have bought a fixer-upper, they will tell you that it wasn’t worth it. They regret the decision. They will tell you that they should have just bought something nice and finished and they would have been happier. Renos are very expensive, and rarely do people get the money back on reins. Typically it’s less than 50%. So when you consider buying “someone else’s renos”, you should consider that you are buying they at 50% of the cost. That’s a great deal!

PropertySold.ca

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