6 Mistakes You Don’t Want to Make When
Buying a Home in Costa Mesa
…and #3 is the Big One!
1) Do you really know the neighborhood that you are looking to live in?
Drive the streets and get a feel where the “cut through” streets are, how the traffic flows, even in a small tract. We have seen dramatic price swings from one street to another even for the exact floor plan because of a street being more used then another. The “in the know” neighbors will pay more or less based on the popularity of a street. This could also be because it is the street with the most kids on it if that is what you are looking for or not. The price can well reflect these nuances. Drive the street(s) both day and night. When you find the right home do not be afraid to knock on the neighbors door and ask them about the neighborhood.
2) House Shopping before Loan Shopping
The lack of a prequalification letter and verification of down payment from a REPUTABLE lender can cost you the home of your dreams. Most sellers will not even entertain your offer without this letter. Get a referral from an experienced friend, realtor, family member that has done business with the lender in the past. Check on the rates, what you feel comfortable with monthly going toward mortgage costs (property taxes and insurance included) and get all the paperwork required to make any offer you make attractive to a seller. You do not want to waste your time looking at $750,000 homes when $600,000 is the magic number.
3) Using square footage to determine the value of the home you are buying.
This one might cost you dearly, yet it is one of the most common mistakes buyers make. The same exact model match floor plan can sell for tens of thousands dollars difference, sometimes even hundreds. Square Foot alone, does not allow for the condition of the property, where and how it sits on the lot, or within the tract itself. We had two exact homes 5 doors down from each other 2,404 sq ft.…one sold for $650,000, the other $880,000….then in the same tract; a floor plan not as popular but dramatically remodeled at only 1,900 sq ft sell for $925,000. The cost per sq ft is wildly different for the first two, because of condition and the 3rd example because it was stunning. Condition, location, floor plan are a much better indicator than just doing some math. Everything is data, but data isn’t everything…math does not always add up when determining what price to offer on your new home.
4) Choose the right real estate agent.
Your Aunt Betty, from five cities away, even though she is giving you back half her commission to help you make the deal, is probably not the right choice. Betty can not know the nuances, the whys of how one home received above full price and a similar home took 4 months to sell. Your home is going to shelter you for quite sometime and is one of the largest investments you will make…interview several agents and find someone who is very familiar with the neighborhood you are interested in. Make sure they listen and understand what you are looking for. The likelyhood that this person will know about homes before they come on the market can be the difference between you finding perfect home or looking with the crowds. Want a street with more dog friendly folks, ask the local expert.
5) Only looking at homes that look “pretty” on the internet.
Not everyone, including real estate agents spend the time, money or forethought staging and lighting their home. You could be missing a gem that is just messy, or photographed badly or has very few pictures at all to entice you. Getting inside some of these homes can be a great way to beat others to a good value. Ugly murals on the wall, dark hallway shots: don’t scratch it off your list. Many people do…less showings on a home can discourage sellers and there may be a better opportunity for you to get a lower offer accepted.
6) Not having a long term vision.
You don’t want to have to move in a year or two and hope that your home will have gone up in value enough to break even or turn a profit after the closing costs on the sale are paid. If you had to move, could your home be rented and cover most of the monthly outlay? Just because interest rates are low, does not make it the right time for everyone to buy. Buying a home is a major decision, take time to make the right one for you and your family.