Buying a property is one of the biggest financial transactions you’ll make in your life and with lots of money comes lots of risk and lots of potential pitfalls.
Whether you’re buying your first home, you’re an existing owner looking to move or you’re thinking of investing in property, there are some common mistakes you’ll be at risk of making.
In this guide, we reveal those mistakes and, most importantly, give you some excellent expert advice on how to avoid them.
What are the most common mistakes that home buyers make?
The most common mistakes you’re likely to make when buying a home are:
1. Not being prepared for the mortgage process
Getting a mortgage for your property purchase can be one of the most stressful and time-consuming parts of the process.
Problems with buyer mortgages are one of the most common reasons property sales fall through, causing incredible stress and upset for everyone involved.
As well failing to prepare their finances for a mortgage application, many buyers also fall into the trap of attempting to buy properties that lenders are often unwilling to mortgage.
How you can avoid this mistake
To avoid problems with your mortgage application, you should:
- Get a mortgage agreement in principle (AIP) before you start your property search
- Be aware of the time mortgage applications can take – often this is between 14 and 30 days but it can be longer
- Check your credit score before applying and make sure everything is accurate
- Close any store or credit cards you no longer use
- Make sure you’re registered on the electoral roll
- Assess your income and levels of debt and try to pay down anything that could affect your borrowing ability
- De-link from anyone with whom you have had joint finances in the past
- Limit the number of credit applications you make in the 12 months before you apply for a mortgage
- Space out any credit applications you do need to make as lots in a short space of time can be a red flag for mortgage lenders
- Don’t withdraw cash on your credit cards as lenders can see this as a red flag
- Avoid payday loans
- Pay for insurance premiums up front rather than monthly, as this can leave a mark on your credit score
To avoid falling foul of lenders’ criteria on certain types of property, it’s best to avoid:
- Properties built with anything other than standard bricks and mortar construction
- Houses or flats with cladding made from Aluminium Composite (ACM), which require a fire safety certificate
- Flats above shops, food venues or offices
- Flats with less than 80 years remaining on the lease
- Properties converted from other premises, including pubs, churches, and schools
2. Failing to factor in additional costs of moving
Moving home or buying your first property costs money – but if you fail to factor in exactly how much, you could be left facing some nasty surprises further down the line.
The two most expensive parts of your purchase will almost certainly be your purchase price and deposit.
But there are a whole host of other costs that can eat into your deposit and failing to consider these could mean:
- You need to borrow more from your mortgage lender because your deposit will be smaller
- Your loan-to-value increases and you’re forced to pay a higher mortgage rate
- You can’t afford to buy your dream home
How you can avoid this mistake
Always factor the many additional costs of buying a home into your budget before you start your property search.
Those additional costs may include:
- Stamp duty
- Solicitor or conveyancing fees, plus search fees
- Survey fees
- Mortgage lender fees, including the valuation fee, arrangement fee and booking fee
- Removals costs
‘’Remember to consider the extra costs on top of your deposit such as Stamp Duty, solicitor’s fees, surveyors, and removals when working out what you can spend,” advises Rob Smith, Managing Director of CJ Hole.
“Do not be half-hearted with this to avoid any surprises later down the line that could lead to your purchase falling through when you can’t afford the property.”
3. Being too emotional on a viewing
Buying a home will always be an emotional process – but allowing those emotions to take over can mean you fail to consider the practical and superficial aspects of the property you’re viewing.
This could mean you fail to notice issues with the property that could either cost you a lot of money to fix or mean the property is not right for you.
How you can avoid this mistake
Always prepare for a viewing so you don’t miss anything while you’re looking around the property:
- Check all over the property for signs of damp
- Look for rot in woodwork or windows that are condensed between panes
- Turn on taps and flush toilets and listen for noisy plumbing
- Look at the roof from the street and look for broken or missing tiles
- Check guttering and external pipework for blockages or damage
- Return for a second viewing and bring a tradesperson with you for a second opinion if you’re concerned about anything
- Consider how much storage the property has and whether this is adequate for your needs
- Look at the flow of the property and whether it has development potential
- Consider which direction the garden faces
“We encourage you to visit the property at all times of the day,” says Rob Smith of CJ Hole.
“Are the streets well-lit at night? Is the street noisy during rush hour?
“Always have a checklist of what you want from the property to ensure it meets your expectations.”
4. Failing to ask the right questions
One of the biggest mistakes buyers often make is failing to ask the right questions when searching for a new home.
A viewing is not only a great chance to take a close look a property and assess its suitability, but it’s also a golden opportunity to find out key information from the seller’s estate agent.
Viewings, however, can be overwhelming and in a fast-moving market, you may feel pressured to make an offer on the first property that appears to tick all your boxes.
How you can avoid this mistake
Write down a list of things you want to ask the estate agent before your property viewing.
Our guide on the right questions to ask can help, but you should focus on:
1. Key property details
- How long has it been on the market?
- How much interest has there been?
- What work has been carried out on the property and by whom?
- Has the property been decorated recently?
- Has the property changed ownership frequently?
- Which direction does the garden face?
- Is the property freehold or leasehold?
- If leasehold, what are the ground rent and maintenance charges?
- How many years remain on the lease?
- How old is the boiler and has it been regularly serviced?
2. Other key questions
- Why are the owners selling the property?
- Have they found a new property?
- How is the mobile signal and broadband speed?
- Is the property in an area with restricted planning laws?
- What is included with the sale?
- What council tax band does the property fall under?
Further reading…
