A home is a major investment and it’s one that stands to appreciate if you continue to invest your money wisely. Avoiding these five critical mistakes will help you turn your home into your greatest asset instead of your greatest expense.
1) Don’t sell too soon.
Generally speaking, it takes at least three to five years to gain home equity. That said, it’s best to avoid reinvesting the money you’ve just spent on professional movers for at least as long. Moving is expensive, time-consuming and stressful. If you tend to move a lot or want the freedom to come and go to see the world, you might consider moving into an apartment or condo before you think about buying a single-family home.
2) Don’t forego the inspection.
Having a local home inspector examine the home is a crucial step in the homebuying process. The job of an inspector is to identify any potential problems with the home -- problems that, left undiscovered, may leave you with hundreds to thousands of dollars in repairs.
A home inspection may reveal major issues with:
- Leaky pipes
- Eroding foundation
- Improper insulation
- Faulty chimney
- Water damage
- Pest infestations
3) Don’t go too big.
Always think in the long term when buying a home. Are you starting a family? Are you buying for more than one family? Is this house just for you, as an individual or a couple? If you buy a house that’s too big, you could be stuck with far more maintenance than you wish to perform like when the water heater goes out, or the AC needs fixing. So make sure you don’t put thousands into a home that doesn’t suit your needs.
4) Don’t overspend on landscaping.
As you’re settling into your new home, you’ll probably consider a lot of renovations. Look before you leap. Unless your home requires immediate renovations, try to spend the first year making smaller changes and building up your budget -- especially when it comes to landscaping. Maybe reseed the grass if it’s in poor condition, but don’t add on a new porch or deck. It’s best to wait at least two years before budgeting for big exterior improvements; this way, you’re better prepared financially should a surprise maintenance issue drain you in the interim.
5) Don’t forget the warranty.
If your home doesn’t come equipped with reliable appliances, you’ll have to purchase them. Consider the warranty on any appliance you consider. Whether you should get an extended warranty depends on how worried you are about the brand of the appliance and the price you pay for it. Cheap appliances are more likely to break down before the warranty is up; high-end appliances are more likely to outlast even the extended warranty.