Things I Would Have Done Differently When Buying My Home
If you haven’t read my housing story yet, please do so. It’s long, but as a blog that talks about money, I think it’s important to talk about one of the biggest investments we may ever make in life.
I am very proud that I was able to purchase a home by myself. If I waited for the right time, who knows when that would have come. If I had waited until I was married, I would still be without a house. Who knew the market would crash soon thereafter or that I would have gotten a raise that next year? Here are some of the home buying mistakes I made when I purchased my first home.
I Didn’t Wait
I purchased my house right before the housing bust, so my house value declined drastically. I believed that in five years I would have been able to sell my house to purchase another one. Unfortunately, five years later my home was worth $70,000 less than what I paid for it.
If I had waited a year or so, I could have gotten a better loan and a better house. One my credit would have likely improved and second, houses would have dropped in price. If I purchased a home just a few years later, I would have been able to purchase a single family home for less than I paid for my townhouse.
I Settled Too Quickly On My House and Agent
There was a little pressure for me to find a house. My agent was leaving to go out of the country and wanted to get me in a house before he left. When I look at things now, it seems like he rushed me into a home I didn’t want.
I often wonder if I would have been able to afford a home closer to my parents or even a single family home in the area I settled in. I don’t think my agent ever looked beyond a townhouse with three bedrooms and two baths in the area I specified. In my opinion, he should have broadened the search and showed me homes I might have been interested.
When looking for a house, make sure you know what you want first. If you’re not sure of the type of house you need, you’ll settle for almost anything. Also, spend some time searching for the right agent. Even though my agent was very knowledgeable about real estate, I don’t think he was really all concerned about my needs.
I Moved Into the Wrong Neighborhood
The neighborhood I moved into was a working class one. It was racially diverse, but there were some homes that were being rented out to section 8. Though I had a son, I didn’t really care for the amount of children who played in the street. No one cared if they hit your car or house with a ball and parents didn’t seem to tell them to stop either.
I also had an issue with the men in my neighborhood. As an end unit, I had more parking spaces than center units. I also only had one car, which for some reason gave my neighbors cause to just park in my spaces. I had cars towed and men screaming in my face. As a single woman, they really tried to bully me around. Thankfully I’m a tough cookie and gave as good as I got, but that strength didn’t help to build relationships with many of them. If I were to do it again, I would have picked a home in an area with a younger and more professional crowd.
I Didn’t Budget for Everything
Homeowners have more housing expenses than renters. If you’re a renter, you call the landlord when something breaks. When you’re the homeowner, you’re the landlord. I didn’t put a budget together to fix the things needed to be done to move into my home. Along with mortgage, utilities, food and other bills, I was barely making it. Try adding renovations into the mix and I was broke.
Thankfully my new position involved a pay increase and my interest rate went down, which brought my mortgage down to a more manageable $1400. If that didn’t happen, it would have been a catastrophe. In addition, I regret not using the money given to me at closing for the kitchen appliances. I went months without a functioning kitchen and was embarrassed for people to come to the house.
I Would Have Been a Better Landlord
When I moved back in with my parents, I tried to rent my house out two different times. Each time ended up in total disaster. Neither tenant wanted to pay rent and were more trouble than they were worth. I plan to write an entire post about my tenants from hell, because I think anyone who is consider renting out their home either out of necessity or investment can learn something from it.
Hindsight is 20/20 and I can spot a professional tenant from a mile away. All of my troubles arose because I didn’t screen potential tenants properly and I didn’t get them out fast enough. This caused me to go into a lot of debt and I spent more time in court than I cared to. It’s sad, but there are a lot of people out there who move around with no intention of ever paying rent. They know the housing laws like the back of their hands and care less about your money or investment.