Fear and anxiety are common when buying a home. After all, it’s a serious decision that comes with life-long responsibilities.
However, it’s also not healthy to worry about things that you shouldn’t really be worrying about. Trulia listed these 4 homeownership myths and real estate mental traps that you should avoid so you don’t get stuck in real estate limbo:
Assuming that buying is always better than renting
Renting is not always “throwing money away” as what most of us are made to believe. The truth is, the decision to buy or rent should be based on several factors (along with your willingness): the average housing and rent prices in your area, the amount of time you plan to spend on that dwelling, your tax bracket, the mortgage rate you qualify for, property tax, homeowners’ association (HOA) fees and insurance rates in your area, projected appreciation in your area, and inflation assumptions.
Believing your current needs reflect your future needs
When buying a home, it is important to consider that you are doing so to suite your future needs and your current needs. You may be single who like to travel and have minimal possessions and don’t have time to spend maintaining a home, but is this the same situation you will be in five years from now? Other factors to anticipate include maintenance costs, HOA fees, proximity to jobs (and potential future job sites), school district, yard size, neighborhood safety, and walkability.
Fear of getting priced out of the market
House prices have skyrocketed in the past five years and this can be reason enough for you to buy a home today in fear that you get priced out of the housing market. However, just like any industry, real estate is cyclical: Prices rise and fall. Additionally, housing is local; which means that Kansas and Jacksonville can have very different market price and appreciation. Considering this, the wisest action you can do is to buy according to your family’s budget and needs, not your guesses on what the future may hold.
Believing all renovations are profitable
Updating your kitchen, bathroom, landscaping and other features will definitely make your home more attractive, but that doesn’t always mean that you will recoup the cost of your renovations. Choose your renovations wisely; there are renovations that will fetch you a higher price while others simply lack a return on investment.