Are you are a prospective homebuyer exhausted by months of searching for ‘the one’?
You may be at high risk of making a ‘fed up’ purchase decision that can cost you dearly long term, warns Buyer’s Agent and Author Patrick Bright.
According to figures by CoreLogic RPData, the percentage of houses and apartments sold at auction in Sydney in the week ending March 15 reached a whopping 78.3%.
That’s the highest clearance rate since 2009.
It’s a similar story in the inner suburbs of Melbourne, where weekly auction clearance rates are consistently at 70% or higher.
Even if you’re not hunting in a hot metro market, more cashed-up and game-ready buyers can regularly pip you at the post.
The current competitive property market is leaving many buyers feeling increasingly disappointed, says Bright, who is Director of EPS Property Search.
First-home buyers in particular may be finding it hard to keep their spirits up.
‘Naturally buyers become disillusioned when they miss out on a potential home they really like,’ Bright says.
‘They are sick of looking and some end up making a ‘fed up’ purchase that will cause them grief both emotional and financial for many years to come.
‘Unfortunately, after buying an unsuitable home a lot of buyers realise they can’t live with the home’s shortcomings and either begin an expensive renovation, which often leads to over capitalisation, or decide to sell and buy a more suitable property.
‘Doing so ends up wasting 10s if not 1,000s of dollars in buying and selling costs.’
Bright says homebuyers ‘must keep their emotions in check’ and remember that another suitable and appealing property is always just around the corner.
Here are 5 tips to help buyers avoid making a ‘fed up’ purchase:
1. Trust your needs/wants lists
Pull out a piece of paper and pen and, if you haven’t already, write a two-sided home wish list.
One side is all your needs. The other side is all your wants.
The needs list must only include features you cannot compromise on – for real.
Must you have 3 bedrooms to house your six children? Write it on the needs’ list.
Do you need to have an ocean view? No, but you’d like one? Pop it on the wants list.
‘This process will help you rule out unsuitable properties before you attend open homes and save you becoming emotionally attached to a house that doesn’t meet your requirements,’ Bright says.
2. Become a home values gun
Make sure you’ve done comparable market analysis and know current values as opposed to following price guides.
‘By keeping your search to properties that are in your price range, your top three suburbs and that match your needs list, you’ll become an expert on that particular type of property in your research area … able to spot a quality property and make an informed offer.’
3. Can you get your hands on the dollars?
One of the surest ways to seal a deal on a high-quality home is with a deposit cheque (or money transfer) today.
If you find your dream home but still have to talk to a lender about getting funds, you run a high risk of losing to a more organised buyer and ultimately making a fed-up purchase of a lesser home.
‘Have pre-finance approval in place and make sure you’re aware of all the upfront costs of buying property e.g. stamp duty, pest and building inspections, legal fees, mortgage fees, removalists etc,’ Bright says
4. Consider hiring an agent
If you’re suffering home-hunter fatigue, minds can play tricks: It may be time to pay for professional (agent) help.
Have you tried to convince yourself that lime-green bedsitter with the outdoor toilet is ‘charming in a retro way’? Yep. You are at dangerously high risk of a dodgy deal.
Engaging a buyer’s agent will cost a percentage of your home’s purchase price, but may save thousands in the long run.
5. Walk away for a wee rest
Guess what? The housing market never sleeps but it also doesn’t vanish if you give yourself a break. You will come back fresher and there are always new fabulous listings just around the corner.
Log-off for a week and see what happens.
That sweet property you really wanted that you missed by a whisker may just pop up again because your rival buyer couldn’t raise the bucks and the contract collapsed.
It happens. It can happen for you. To recap, avoid fed-up buying by:
- Buying only what’s on your shopping list
- Studying home prices and values so you don’t overpay/under-offer
- Getting your money sorted
- Bringing in outside help if needed
- Taking a house-hunting holiday