Nine mistakes that house hunters make
House hunting is often fraught with frustration, but if you can avoid these nine mistakes below, you could be in for an easier ride.
Location is probably the most common one, says Jacqui Kalka, a brand and territory owner for Mike Pero Real Estate.
"People often have a pre-determined view of the exact streets or suburb they want to live in, but proper buying is all about compromise in that you will always have to compromise on one of three things; price, location or size."
And Alistair Helm, property expert and founder of Properazzi NZ, agrees. He notes that buyers often aren't willing to move out one more suburb when there is more house for their money, and at current values probably a chance of greater capital gain as values ripple out from the centre. He advises to pay a lot less, have a smaller mortgage, have some freedom, do some re-decorating and reap the benefits.
"Sure we do need to respect all buyer's intentions, but they too need to be a little more flexible in today's market. People have a house in mind and their search is all too often narrowed by being fixated on this list. I know we lead busy lives, but if you have a budget limitation and want that perfect home, then drive 10 to 15 minutes further each day to work."
Probably the most important factor when it comes to buying a house is what price you purchase it for. Which of course depends on how much you have to spend, and whether the house is on the market near that amount. But according to Kalka, a lot of home buyers are selling themselves short when it comes to the subject of price.
"They quickly reject property without a price, which is around 40 percent of properties; and while I can understand their frustration that agents won't give an indication of a price range, omitting any property is not smart. You need to be open to check out properties that could be a 'maybe' as well as those that are a must."
Helm notes that people usually have a budget based on a self-imposed mortgage limit or even no mortgage at all - which are both sensible - but when the house they really want is that little bit more, well then it might be time to break free of those constraints.
NOT VISITING THE PROPERTY:
With so much information available online, sometimes home hunters can get caught up just viewing properties on an agent's website, but Kalka says that photos can only show you so much and that you need to experience a house to get a real sense of it.
"I also find people don't take enough time at an open home - you should really walk through twice. And outside the property you should spend time in the area before and after an open home, as well as visiting it at different times of the day and week. Properties and the surrounding suburb can vary quite a bit between the week and weekend."
There is no doubt photographs are important, says Helm. Bad photographs could mean anything from minimal marketing investment, to below average real estate work, to a poorly presented home, but, there could actually be a real opportunity hiding underneath those layers.
"Don't let someone else's clutter put you off, because you may actually find there is less competition for this home."
When you are investing hundreds of thousands of dollars into something, it is reasonable to have high expectations around what you will hand that money over for. But sometimes house hunters can get a little caught up in finding perfection. Helm tends to see this with a lot of first-time buyers who are after what would be their parents 'third house' as their first home, but it is actually a case of getting on the property ladder first and making improvements that create capital gain, then moving up.
"It is a step-by-step process, not one buy that gets you your dream home."
Helm recommends having a list of 'must haves' but to keep them reasonable. Don't dismiss a property because of one issue when many other factors are right.
"Work out those things which are non-negotiable, like four bedrooms, sun, school zone, single level. You can't alter the location but everything else is cosmetic and can be changed."
Kalka says that size is another preconception, in that people seem to fixate on a certain number of bedrooms or bathrooms, yet they often have no real need for that fourth bedroom - it is just for the once every three year visitors.
Orientation is often seen as a very important feature for a property and Kalka says there is a view among people that a house with a back yard facing north is worth far more than a garden that faces south. But that isn't always the case.
"I can actually speak from personal experience; there are a few benefits of a south facing garden and house. In summer the sun reaches right around to the back and the shading effect later in the day is better, especially in hotter parts of the country."
DOING YOUR RESEARCH:
There is probably a bit of an overload when it comes to property housing information and sometimes it can even present opposing views in the same market. But buyers need to do their own research and analysis of what is happening in their local region.
"I find people don't start their search early enough," says Kalka. "You need to literally get 'in training' at least a month or two before you start to take it seriously. Visit any open home and attend auctions for property that is in the area, even if you don't like it, because it helps you get a real understanding of what is going on."
And if the earlier half of this year is anything to go by (particularly in Auckland), the property market can really throw up some surprises. Helm finds people don't study the market enough to know what a property at auction just might go for.
"Ask the agent for a list of recent sales in the area and double check their price indications. You want to know if your investment in a building inspection/valuation is going to be a waste of money or not. Ask yourself 'am I in with a chance here?'."
If the interior décor of a property is not something buyers are keen on, then it can sometimes cloud judgement on whether or not the house is desirable. But as Kalka points out, things like the condition of the garden and wall colours are easily changed, so it shouldn't be something that is focused on.