Buyer’s remorse, on some level, is very normal for all buyers to go through, but surprisingly, buyers can experience remorse in all phases of buying a home:
- the house hunting phase
- getting to the close date
- after moving in
Most buyers are worried about if they are paying too much for a home, are they buying the right home, and can they handle the new financial demands of a new home.
Here are tips to avoid, or at least lessen any buyer’s remorse and get the right house for you.
Avoiding Buyer’s Remorse When you are House-hunting
Although this is an exciting and fun time when buyers are house-hunting, it can also lead to some anxiety about the future. The biggest hurdle for buyers in this stage is wondering if they are making the right decision. After all, this is a big financial commitment and first-time homebuyers and experienced homebuyers alike have this nagging question when they are searching for homes.
Hush the peanut gallery
Although tempting, limit asking too many people for their opinions and instead spend your time gathering the facts. Trust in yourself that you will know if this is the right house for you or not. Opinions are cheap but getting the facts is invaluable. My tip is to spend your time getting the facts from experts and limit the opinions from friends and family. Unless they will be living with you or helping with the monthly mortgage payment, you can keep their opinions to the side.
Get the facts about your finances
One of the best ways to make a decision and to avoid buyer’s remorse is to gather as many facts about the home buying process and about the property as you can. This starts by understanding the lending process, the different lending products available to you, the cost of the loan, your interest rate, your credit score, and if you can do things to clear up credit items that could give you a lower interest rate. These are just a few things to know.
If you have been following me, you know what I’m going to say next: use a local lender. (Contact me for my list of preferred local lenders.) Why?
- A local lender will help you compete and win the bidding war in the Olympia real estate market because local listing agents know the value of local lenders versus national lenders.
- A local lender knows the real estate process for Thurston County, which reduces delays on your loan.
- A local lender has the local appraiser contacts that can get to the property quicker.
- A local lender can take the time to walk you through the lending process and explain financing.
Lending is the most complicated part of the transaction. When you work with a local lender, you’ll get the facts about how much the loan will cost, what your monthly payment will look like, and tips that could help you lower your monthly payment.
Be realistic about your budget and what your budget can buy under the current market conditions.
Gather more facts about the home
Have your buyer’s agent get a copy of the neighborhood rules (CC&Rs) for you to review, a copy of the Seller Disclosure Statement, and if available, a copy of the preliminary title report.
Look at maps including past and current aerials to see what kind of properties surround the home you are interested in purchasing. Look at flood maps. Have your agent pull this information or use Thurston County’s www.geodata.org site for maps and other information.
Look at the neighboring houses and if you are feeling extra bold, talk to the neighbors. Find out what it’s like living in the neighborhood.
Be objective and evaluate homes like a real estate agent
Buying a home is an emotional rollercoaster and it is challenging to take out all of the emotion when buying a home, but I suggest focusing on your budget and your basic list of wants and needs.
When I help buyers search for homes, many buyers will give me a very long list of their wants and needs. I pick out the most important needs the buyer tells me and whittle the list down to just three or four items. This way the hyper-nitpicking is lessened as well as the flip side of having no filters in place; for example, considering a two-bedroom cottage when you’ll have six people living there.
Stick to your budget and focus on your short list of wants and needs. This will help you hone in on properties that will best match your requirements.
How to submit an offer when there is a bidding war
It’s easy to get caught up in the process of bidding and winning. This can lead to remorse if after the bidding dust settles, buyers realize they offered to pay more than they wanted to for a property.
Have your agent run the comps to see what other homes have sold for and discuss with your agent your offer strategy. What is your top number you are willing to pay for the home? And what is your number where you agree is too much for the property and can walk away? Having this determined before you get into a bidding war will help lessen any remorse afterward.
Know the area and neighborhoods
One of the bigger reasons for buyer’s remorse is buyers believing they chose the wrong location or neighborhood. Get to know the area. Drive the neighborhoods at different times of the day. What is the traffic like? Is it noisy? How do the neighbors maintain their homes? How far are amenities? Are there other influences that could affect your enjoyment of the home like is it near a farm, an airport, etc.? If you are commuting, be realistic about the distance. Is it too far to commute every day?
Avoiding Buyer’s Remorse When you are Under Contract
When you are under contract to purchase a home, this is when it can get real for buyers. Buyers are signing legal documents, providing more documentation to their lender, gathering funds, taking care of contingencies and this can be overwhelming.
Understand the purchase and sale agreement
Work with your buyer’s agent to understand the purchase and sale agreement. What are your contingencies and what are those timelines? How can you back out of the agreement if necessary? Your agent is here to help you; lean on their expertise and advice. The more you know about your transaction, the process, and the paperwork, the more it will help you make quality decisions and lessen any buyer’s remorse.
Get the facts about the home with a home inspection
Even in this steep seller’s market, it will be valuable for most buyers and most properties to have it inspected by a professional home inspector. This is another way you can gather the facts about a home. A home inspection can answer questions about its condition and whether the home might be a financial burden with expensive needed repairs or desired updates.
Stop looking for homes
Once you are under contract, stop looking for homes. Otherwise, you will constantly be in a state of “there might be something better.” Don’t torture yourself. If you’ve done your homework, research, and fact-finding, you can rest assured you are making a solid decision.
Avoiding Buyer’s Remorse After Moving In
If you have done your due diligence and research, you should just be able to focus on moving in and enjoying your new home. But this is where reality sets in. Buyers will be getting used to not just the home but also getting used to new bills, a new mortgage payment, and renovation costs.
Revisit your original goals when you were house-hunting
Because there are so many details to a home purchase, it is very easy to get caught up in those details and remain in those details. Step back a little and remember why you wanted to buy a home and what those needs were. What are the best aspects of your new home? I have a long list of why I love owning my own home; what do you like most about being a homeowner?
“The house is too small!”
You move in and can’t find room for all your stuff. Take an inventory of your things. Do you have too much? Can you downsize your household goods? Or can you come up with creative storage solutions?
Many of my buyers know they have certain things that they need room for like a piano or maybe they need room for their woodworking hobby. These buyers are already looking for space for these items. Many times, the complaint is the home lacks good closet space. Free-standing armoires, installing a closet system, or swapping out a pedestal sink with a vanity in a bathroom can improve storage options.
Fences and tall hedges are good things
As they say, fences make great neighbors. If you move in and discover your neighbor isn’t what you had hoped for, a good fence or some mature landscaping can do wonders! Or another route is to bring a gift to the neighbor and have a chat and hopefully improve the situation.
Replenish savings
The shock of liquating your savings account to pay for your home can cause panic. Even though your liquid cash may be lower, you invested it into an asset that will grow in equity in the long term.
Your monthly mortgage payment will also take some time to get used to but you will and you will be able to adjust. It’s also helpful that you’ll have a month of reprieve from making your first mortgage payment.
Know that you did your financial research and can afford this home. Continue to live below your means, save, invest, and build wealth. When the time comes to sell your home, you most likely will make a nice profit.
In Summary
The #1 tip to avoid buyer’s remorse is to get the facts. The more you know, the better quality decisions you can make. For more tips and help with your next home purchase, call me and let’s chat.