What are the top three problems that first-time homebuyers experience almost every time?
1. Confusion about what it is they ultimately want to buy.
Since first-time homebuyers haven’t owned a home before, they haven’t thought through the things they actually really want in a home. When you go to buy a home your needs, wants and desires for the space that you want is probably going to be dramatically different than when you were renting—due to the fact that people are more likely to sacrifice when they know a living situation is temporary. When it comes to owning a home, there is a different level of permanency. People tend to up their criteria, have more standards, and have more scrutiny about what it is they actually want to buy.
The number one way I tell first-time buyers to overcome this problem is to “Go see as many homes as you possibly can.” Ultimately, the easiest way to see a ton of homes in a short amount of time is to clear your weekend schedule and just drive around and go to as many open houses as possible. Even if you’re not going to buy it, it’s helpful to see the many different layouts, price points, and styles of homes that exist in different neighborhoods so that you can get a feel for what it is you really like. This enables you to more ideas as you see other peoples spaces that you’re not planning on buying, and you can then get the inspiration and the motivation for what it is that you actually want.
2. Not understanding the true cost of homeownership.
Oftentimes a new homebuyer underestimates the cost of buying a home and overestimates their abilities, especially their financial ability. It is not uncommon for a first-time buyer to walk into a fixer-upper home and start making plans to knock down this wall, add new floors and windows, add a room here or there, and renovate all of the bathrooms. Maybe the listing price of the fixer-upper is within their budget, but they’re not accounting for how truly expensive it is to do home renovation projects, how much time it takes, and since they’ve never owned a home, they’ve probably never taken on those projects themselves before. A lot of first-time buyers are price-sensitive, so even buying all new furniture is sometimes at a cost that they’re not accounting for, let alone trying to renovate an entire house.
As a real estate agent, I try to really dial back the expectations of first-time homebuyers and explain just how expensive it is to renovate a home.
3. Not understanding the process.
This is where hiring a really quality real estate agent comes in. One of my favorite things to do is sit down with a new buyer, go into teacher mode, and explain exactly what we’re going to do and exactly what they can expect to experience. It’s also important to go over the answers to questions such as what does the search process look like? What does the transaction process look like? What does the offer process look like?
By answering all these questions and explaining all possible outcomes of each situation, clients are surprised less when problems arise because we’ve already talked about them. People who are confused have a hard time moving forward, so removing as much of that confusion as possible upfront and throughout the process will help a first-time homebuyer be a confident, educated decision-maker. And, in the end: happy customers.