The most common reasons why some home buyers fail
Tags: Toronto real estate, Toronto condos, Toronto homes, Toronto realtor, Toronto housing
In Toronto and the GTA, buying a house can seem daunting, if not impossible. After all, the prices of housing have risen exponentially over the past few years and the supply has been limited.
Even with all the perceived challenges, we have helped complete hundreds of transactions for buyers in our beautiful city. We have identified the most common factors of success that we always share with our clients, however, we have also identified the most common factors of failure.
We have outlined the reasons why most buyers who are willing and able to purchase a property never do so, or do so with limited success.
Common failure factors
Many people make some of the mistakes mentioned above because of a lack of understanding of the dynamics of the real estate market. This may result in over-analyzing, fear of overpaying, missing opportunities, frustration, and in the case of not buying a property, delaying the purchase long enough, to the point where they end up paying much more than they would have initially paid - effectively realizing their fear of overpaying.We have outlined the reasons why most buyers who are willing and able to purchase a property never do so, or do so with limited success.
Common failure factors
- Lack of proper planning and thought before viewing properties.
- Lack of time allocated to the buying process, which includes the very important and necessary learning phase. As an example, in the early stages of the process, it is important to view multiple properties, including some that are not to the client's liking. This will allow the client to truly understand the market and the factors that affect the price of the property.
- Assuming you are already familiar with the market because of the information viewed on real estate apps (photos, listings, and sold prices). Viewing and analyzing a property in person cannot be replaced by an app. The information and images on the site may be misleading and may promote incorrect interpretations of a home and its price.
- Not taking the time to have an in-depth discussion with a real estate agent about the number of offers and the sold prices of the properties they have toured. It is important for clients to understand why those happened.
- Viewing properties only on weekends or on weekday evenings, the times when most people are visiting homes, which increases competition. Doing this during the “hunting mode” is particularly detrimental.
- Not having a mortgage pre-approval in writing. Nowadays, many sellers wish to be assured that the buyer will not have financing problems at closing, therefore sometimes submitting a pre-approval letter increases the likelihood of winning the house. Buyers also do not want to be in a position where they end up buying a home that cannot be financed at a later time.
- Insufficient understanding of all the numbers involved in purchasing a property, including transaction costs, cash requirements beyond the purchase price, and carrying monthly costs in addition to mortgage payments, such as condo fees, maintenance fees, property taxes, insurance, monthly rentals, and utility bills.
While some people may end up buying a property, which is an excellent achievement, when they lack an understanding of the market, they may sometimes overpay for a home or buy out of frustration, even when they are not truly convinced about the property they are buying.
Therefore, to make a wise and confident purchase, it is essential to be aware of the learning process before entering the purchasing market, and to recognize some of the reasons why people aren't successful when purchasing a home.
At In Black and White Real Estate Team, we are here to partner with our clients during their real estate transitions. We continuously strive to match their evolving needs by bringing insight that makes a difference. We provide innovation, expert advice and we enable our clients to focus on what is important to them.
If you are interested in buying a home, please give us the opportunity to show you all that we can do for you. Let us do the heavy lifting so that you can enjoy the experience.
