Owning your own home is the cornerstone of the American Dream. It’s the one opportunity many people have to own property and begin accumulating wealth.
But buying or selling a home is a major responsibility. It’s important to do your due diligence as a buyer or seller to keep your American Dream from turning into a real estate nightmare.
Check out this list of common real estate nightmares when selling or purchasing a home.
Real Estate Nightmares for Sellers
Selling a home can bring huge profits when the market is in your favor. The downside to the selling process is that it requires a tremendous amount of patience.
You can’t control who makes an offer on your home or when they make an offer on your home. You can only control how you react to these worst-case scenarios if they arise.
Water, Water Everywhere
As your home appreciates in value, however, it also suffers normal wear and tear. Most sellers expect some cosmetic fixes to be required before a buyer will close.
But what about the areas behind the wall you can’t see? You might think that cracks in the stucco in your home’s exterior are no big deal but this can be a sign of water damage.
As the water gets into the cracks of your home it can lead to things like wood rot and mold. Depending on the extent of the water damage, these might be a deal-breaker to a buyer looking to close quickly.
In most cases, however, the damage will simply lower value of your property. To avoid surprises, you’ll want to get ahead of the repairs by getting the home surveyed well before putting it up for sale.
Last-Minute Cold Feet
It happens to the best of us. One minute we are absolutely sure we want to order dessert but by the time the waiter comes back we’ve changed our mind.
Unfortunately, buying a home is nothing like ordering dessert. A buyer changing his mind last minute creates stress for you and both your realtors who have likely spent months trying to secure this transaction.
For sellers who’ve already secured new housing, this last-minute ditch can mean paying to live in two places or delaying the enrollment of your child in a new school. Not being able to plan out your future and your finances is a nightmare for sellers.
Low Appraisal
Selling a home is an emotional process. The idea of an appraiser coming in and deciding what your home is worth without your input is troubling for most people.
Avoid taking your appraisal too personally. There are times when the appraisal comes in dramatically lower than your expectations.
Ask your realtor what options you have for getting a second opinion rather than going into battle mode. Go over the appraisal in detail with your realtor to make sure there are no errors or omissions that are affecting the valuation.
Real Estate Nightmares for Buyers
Buying a new home can be like winning the lottery. If the property is well-kept in a fast-growing neighborhood, you gain the opportunity to get equity with no sweat off your back.
But there are few times in life when we experience happily ever after. Here are a few real estate nightmares to watch out for when buying a home.
House Isn’t Up to Code
Buying a newly renovated home can feel like getting a free upgrade. Remodeled bathrooms and kitchens with granite countertops and freestanding tubs are enough to make a home buyer fall in love.
But just because the changes are beautiful doesn’t mean they are legal.
Most people feel like they can do mostly they want in the privacy of their own homes. Unfortunately, state law says otherwise.
Buying a home with unauthorized renovations can leave you liable for expensive repairs. Cross-check with your local permitting office to verify the permit paper trail.
An honest seller should include this information with his property disclosure but the ultimate responsibility for getting the details falls on you.
Cheap Upgrades/Fixes
Sellers reluctantly promise the world to get you to close on the deal. Make sure they follow through with quality repairs and upgrades.
A real estate nightmare can quickly arise when you realize the seller took the cheap route in fixing a door or appliance. Most buyers negotiate their offer price based on the expenses the seller agrees to.
Having to redo work after closing on the home is a major financial inconvenience. Be specific with your expectations when negotiating repairs after a home inspection.
When you do your final walkthrough, go through every requested repair with your realtor. The home buying process is tedious but keeping an eye on details throughout the process helps you to avoid a mess after closing.
Negligent New Neighbors
You buy a house in a fast-growing neighborhood, then the house across the street sells. The moment your neighbor parks his car on his lawn, you know you’re in for a long road ahead.
Real estate nightmares don’t always revolve around closing. The ones that involve your new neighborhood are involved surprises that will affect your blood pressure for years to come.
Getting involved with your local homeowner’s association is one of the simplest ways to handle negligent neighbors. You bought your home based on its curb appeal and rising property values.
Take charge of your investment by connecting with community leaders to ensure all homeowners maintain the standard of your new neighborhood.
The Price of Homeownership
Luckily, most real estate nightmares happen before closing giving buyers and sellers a chance to face their demons. Spending more than you expected is, by far, one of the simpler fixes to the nightmares on this list.
Long term issues are possible to fix with patience and due diligence. For more information on protecting yourself from the common pitfalls of home buying, check our blog for updates.