7 Common Homebuyer Regrets
Most
new homebuyers don't regret becoming homeowners. In fact, according to a recent
survey by Zolo, 80% of Canadians who purchased a home during the pandemic say
they're glad they bought their current homes.1 But that doesn't mean
newly-minted homeowners don't have any regrets about their buying choices.
On
the contrary, research shows that even the most-satisfied homeowners would
change some aspects of their home purchase if given the opportunity.2
Some question their decision to move to a neighbourhood they still don't love.
Others wish they had been less picky about where they lived so they could have
paid less. Many are afraid they overspent or think they sacrificed too much in
their rush to buy a home.
According
to a new survey by Mortgage Professionals Canada, nearly 80% of Canadians still
see real estate as a favourable long-term investment. But a growing number of
Canadians also admit to being more financially stressed in the short-term due
to lingering fallout from inflation.3
Here
are some of the most common homebuyer regrets we see, along with our
professional advice on how to avoid them.
REGRET #1: Spending More Than
Necessary
No
one wants to overpay for their new home purchase (and, luckily, with the right
guidance, doing so is avoidable). But even if you've secured a winning purchase
price, there are still plenty of ways to accidentally overspend.
One
of the most common ways to overpay? Choose the wrong mortgage. In fact, in
today's higher-rate environment, this can be one of the riskiest mistakes a new
buyer can make.
Many
Canadians also put off learning more about their mortgage options and don't
take the time to fully understand their loans. As a result, more than a third
of survey respondents told researchers at TD Bank last year that they were
“confused” about how rising rates would affect them.5
Lesson Learned: As long as you stick to what
you can afford, buying a home can be a boon for your financial health. The
longer you live in it, for example, the more your home is likely to appreciate
in value and boost your long-term savings.
It is highly advised that you engage with a professional mortgage specialist, like Jerome Trail from The Mortgage Trail at the very beginning of the home buying process. Your mortgage specialist is a very important Team member. Second, it is very important that you complete our very basic personal budget form so that our Team can guide you through various cash-flow scenarios. By utilizing our popular home buying system, you will never overpay.
REGRET #2: Rushing Into a Home Purchase
In a
competitive housing market, it's often necessary to act fast to secure a home.
But don't let a need for speed tempt you into making an offer before you've
thought through or fully vetted a new property.
Rushing
into a home purchase isn’t just risky, it's also one of the most commonly cited
sources of homebuyer regret. According to a survey of U.S. homebuyers, for
example, more than 1 in 4 felt remorse over how quickly they sped through the
purchase process.2
Getting
swept away by your emotions can also lead to buyer's remorse. If you've found a
home you love and are competing with other buyers, it can be tempting to
overlook key details or bid more than you can afford. That's one reason it
helps to have a skilled professional by your side to calmly guide you through
the process and ensure you act with reason, rather than emotion.
Lesson Learned: Buying a home is exciting.
But if you don't keep your emotions in check or act too impulsively, you could
make poor choices in the moment that are hard to undo later.
To
avoid making last-minute decisions that could backfire, know what you want,
what you need, and what you can afford before you start your home search. We
can help you set priorities so you’ll be able to move forward with confidence
when the time is right. Our FREE Homebuyer Consultation is absolutely the best way to get started.
REGRET #3: Miscalculating the Costs
of Homeownership
Though
real estate is a great long-term investment, it can be pricey in the
short-term, often surprising homeowners who aren't prepared for it. According
to some estimates, for example, annual maintenance could cost as much as 1% or
more of your home's purchase price.6 Some buyers also forget to
factor in additional ownership expenses, such as property taxes, insurance, and
repairs.
Failing
to think through the costs of homeownership is one of the most common sources
of homebuyer regret. According to the survey of U.S. homebuyers, for example,
nearly half of the buyers who regret their purchase said they underestimated
how much they would spend to live in it.2 Similarly, Zolo's March 2023
survey of Canadian homeowners found that nearly half of recent homebuyers
didn't bother to create a budget before they bought their homes.4
However,
some homes cost more to live in and maintain than others. So even if you're
certain that you can afford the average cost
of homeownership, that doesn't necessarily mean that every home in your price range will fit neatly into your budget.
For example, very old homes with unique maintenance requirements could be extra
pricey to keep up. Similarly, homes with high condo fees or above-average
utility bills could also eat into your monthly budget.
Lesson Learned:
A home should help you build your wealth, not drain
it. So it's important to factor in all the
potential costs of living in a home—not just obvious ones like your mortgage
payment and taxes. To ensure you don't get overextended, add up your estimated
maintenance and repair costs, as well as any miscellaneous expenses that are
unique to a particular home. A trusted and experienced real estate agent should include this type of analysis in their initial discussions with you.
We
can help you with these estimates—and, if needed, present you with some
less-costly alternatives.
REGRET #4: Underestimating the Time
Required To Maintain or Renovate a Home
One
of the most joyful aspects of homeownership is getting to relax in a home
that's all your own. But if a home is too high maintenance, then you may not
have time to savour it.
Many
homeowners love to spend their weekends puttering in their gardens or
undertaking home improvement projects. But if that's not you, then you may not
like living in a home with a big yard or with high-maintenance features, like a
pool.
According
to another survey of U.S. homebuyers, for example, 47% of buyers who feel some
regret about their home purchase complain that too much maintenance and upkeep
is required.7
Similarly,
buyers who purchase fixer-uppers are often surprised by how much time it takes
to rehab their new homes. Although buying a fixer-upper is a great way to save
on the purchase price, you could come to resent it if it eats up all your free
time.
Lesson
Learned: Renovation and maintenance projects
are often time-consuming and stressful. So beware of committing to a property
that requires too much of your attention if you don't have the time or patience
for it. With that said, home improvement projects can also bring a lot of joy
and satisfaction to owners who like rolling up their sleeves.
We
can talk through the realities of homeownership with you and help you choose a
property that will fit your personality and schedule.
REGRET #5: Ignoring or Skipping a Home Inspection
It’s easy to get swept up in the excitement of buying a home.
Sometimes, buyers will agree to skip a home inspection to sweeten their offer
in a competitive market. In fact, according to Zolo's survey, only 36% of
Canadian homebuyers hired a home inspector last year.4 However, if you skip out on a home inspection,
you could come to regret it.
When
you hire a home inspector, you get a professional, in-depth examination of the
property’s structures and systems before you buy it. It’s a worthwhile investment
that can save you money in the long run, either by warning you away from a bad
purchase or by providing a list of deficiencies you can use to negotiate with
the sellers.
But
even the most thorough home inspection isn't going to be worth much if you don't
take the time to carefully consider it. If at all possible, make sure you’re
on-site during the inspection so you can observe and ask questions. And don’t
forget to re-evaluate any repairs that the seller agrees to make to ensure
they’ve been properly completed prior to closing. Our Team home inspector, Allen Ottaway, is one of the best!
Lesson Learned: A home inspection can reduce
your risk and save you money in the long run. But to maximize its
effectiveness, you will need to be an active participant in the process.
REGRET #6: Choosing a Home That
Doesn't Fit
Homeownership
is often a better investment if you’re willing to stay put for at least five
years.8 But if your newly purchased home isn’t a good fit, then you
may not want to stick around that long.
Many
homeowner complaints come down to simple lifestyle issues: Although a mismatch
may seem small at first, the problems can magnify if you make so many
compromises that they interfere with your quality of life.
Or,
sometimes homebuyers can fall in love with a beautiful home and forget about
practicalities. For example, a stunning kitchen can’t replace a needed bedroom
or bathroom. And a sparkling pool may sit empty if the home requires a lengthy
commute to your office.
Make
sure you set some guardrails during your home purchase so you don’t
over-compromise or accidentally prioritize your wants over your needs.
Lesson
Learned: When you’re dealing with limited
inventory or a fixed budget, it may be necessary to sacrifice some items on
your home wish list. In fact, a newly released survey by CIBC found that nearly
a quarter of hopeful homebuyers have revised their expectations of a home.9
But if you fail to secure your must-haves, you could come to regret your home
choice.
We
can help you avoid an ill-fitting home purchase by working with you to set (and
stick to) priorities and parameters before you begin your search.
REGRET #7: Purchasing Without Professional Help
Another
path to homebuyer regret? Foregoing the expert guidance and market insight that
you can only get from a licensed real estate agent.
Buying
a home without professional representation can be extremely risky. Therefore,
it’s no surprise that most Canadian homebuyers enlist the help of a professional, full time real state agent when
purchasing a home.4 And the vast majority find their assistance to
be invaluable: According to a survey of U.S. homebuyers, 89% say they would use
their agent again or recommend them to others.10
Real
estate is extremely fluid—especially these days when the market
is in constant flux. So it pays to have a knowledgeable expert and their TEAM by your side who
can guide you through an often-complicated process.
We
can help you avoid expensive mistakes that could lead to buyer’s remorse, all
while making your home purchase as seamless and stress-free as possible.
Lesson
Learned: When you work with a professional, full time real estate agent you benefit from a wealth of expertise and on-the-ground insight that
you can't get anywhere else. We will help you steer clear of the missteps that so
many homebuyers make, so you can focus on enjoying your new home instead of
questioning your choices down the road.
The
best part? We offer our invaluable guidance and assistance at no additional cost to you as the Seller will pay the commission.
BOTTOMLINE
No one wants to look back on their home purchase and realize they made a big mistake. We can help you avoid the pitfalls so you can buy with confidence. To learn more about how we work to ensure our clients’ satisfaction, reach out today to schedule a FREE homebuyer consultation.
The above references an opinion and is for informational purposes only. It is not intended to be financial, legal, or tax advice. Consult the appropriate professionals for advice regarding your individual needs.
P.S. Download our FREE Home Buyer's Guide and FREE Home Seller's Guide
P.S.S. Book a FREE Home Buyer Consultation or a FREE Home Seller Consultation
Sources:
1. Zolo -
https://www.zolo.ca/blog/housing-market-pandemic
2. Anytime Estimate -
https://anytimeestimate.com/research/american-home-buyers-2022/
3. Mortgage Professionals Canada
- https://mortgageproscan.ca/docs/default-source/consumer-reports/2023/march-2023_mpc-report_final_en.pdf?sfvrsn=c6b39b60_2
4. Zolo -
https://www.zolo.ca/blog/canada-housing-market-report
5. TD Bank - https://stories.td.com/ca/en/news/2022-06-29-td-real-estate-survey-reveals-38-25-of-canadians-are-confused
6. Scotiabank - https://www.scotiabank.com/ca/en/personal/advice-plus/features/posts.how-much-should-i-budget-for-home-maintenance-costs.html
7. Hippo - https://www.hippo.com/blog/2022-hippo-housepower-report-how-homeowners-are-responding-essential-maintenance-during
8. Wealthsimple -
https://www.wealthsimple.com/en-ca/magazine/buying-vs-renting-your-home
10.
National Association of Realtors - https://www.nar.realtor/research-and-statistics/research-reports/highlights-from-the-profile-of-home-buyers-and-sellers#homebuyers
