5 First Time Home Buying Mistakes I Made That Cost Me Big Time

In the season finale of my web series Awkward Money Chat, I described how my house was my best money decision. Although, as many of you know the entire experience of purchasing, renovating and owning my home has been fraught with trouble. Until recently, I was contemplating selling the home and just being done with it (more on that later.)

I like to think of the first year of homeownership akin to (what I assume to be) the first year of marriage. It’s often the most difficult, because you don’t know what to expect. You’re used to something different (renting) and the entire year is spent adjusting. It isn’t as great as you think it would be, and it often involves a lot….a lot… of hard work.

Next week it will be my one year anniversary of closing on the house. I’m celebrating in my own small way, but there are still things I would change if I could.

Here are the 5 things I would have done differently during my First Home Purchase.

FREE BONUS: Download the Ultimate Homebuyer’s Checklist for more advice on what to do when buying your first home.

I Would Have Bought a Condo

Hind-sight is always 20-20, isn’t that what they say? I did the best job I could and made a decision based on the set of circumstances that were true at the time. If I had a crystal ball to see if I would have been a single female homeowner three months after I bought the house then, yeah, I would have bought a lower maintenance condo and skipped the renovations altogether.

But I don’t know, it hasn’t been all bad. And I now know all kinds of crazy stuff, like how to hang a light fixture, troubleshoot plumbing problems, and DIY all over the place. And I do feel a sense of empowerment having weathered a major renovation on my first home-alone. That counts for something.

I Would Have Prioritized Renovation Projects Better

I renovated the downstairs bathroom instead of the “master” bath, because the green bathroom was hideous and I couldn’t stand to look at it. Yet every day when I run out of counter space or have to shower in my teeny-tiny stall, I wish I’d done it differently.

I Would Have Asked More Questions

I think there is a difference between paying attention and asking questions. You can pay attention your whole life and never get up the nerve to ask questions. I think I was afraid to ask questions during the mortgage and renovation process because I was (obviously) out of my depth and didn’t want to seem unintelligent. Particularly when fishy things began happening with my contractor, I questioned him once and took his half-assed explanation at face value.

I Would Have Done More Research

I only shopped at two places for a mortgage. I only got two bids for the renovation work (partially because it was difficult to find a contractor willing to take on 203k renovation loan.) I didn’t check references or anything. I just felt like I got a “good vibe” from my contractor and trusted my gut. Sometimes even your gut can be wrong, and there isn’t anything bad about backing up a “gut feeling” with a little hard research.

I Would Have Budgeted More

I mentioned this before in the article on HGTV Frontdoor. I had my budget for the purchase and the renovation. Even without the down-payment assistance I received from the City of Atlanta, the budget barely left any room for overages. If I’d done more research, I would have been able to make a better budget. My rule of thumb now? Whatever I think something home-related is going to cost, I double it..just in case. Better to be surprised than stressed.

Many of you have followed up with me regarding this post, and I’ve decided to stay-put for another year at least. Not because of the capital gains tax, but after consulting with a realtor, I don’t think I’d be able to sell the house and make my money back, which even though money isn’t an important thing, I can’t take a loss on the house. At least not this year. I also really tried to imagine myself moving again and the thought exhausted me, so I’m here for the time being. I’m even working on a few house projects (posts to come in the following weeks.) Thanks to everyone who weighed in with such great advice!

Want to hear more of my journey as a first-time homeowner? Click to watch the latest episode of Awkward Money Chat.

  • http://www.enemyofdebt.com Travis @Debtchronicles

    My wife and I made a very deliberate transition through homes:

    1.) First year of marriage we lived in a townhouse, which allowed us to get a feel for what we wanted/needed in a home
    2.) next 7 years we lived in our starter home, which allowed us to get a feel for what home ownership was like, what maintenance we were willing to take on and what we didn’t.
    3.) Built a custom designed home that has pretty much everything we ever wanted in our home. We lived in this home for 10 years now, and still love the house as much as the day we moved in.

    The one thing we would have done a better job of with our first home, though, is research the neighborhood a little better. The realtor said a group of 6 plexes were filled with nurses and residents from the nearby Mayo clinic. Untrue……the day I was riding bike with my son down the street and saw a car pull up to one, saw an envelope go one way, and another envelope go the other direction I knew it was time to look at moving…..

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      That is a super deliberate state of transitions and I applaud you for it. My real estate choices definitely feel very “emotional.” And I live in such a neighborhood as you described, but I did my homework and went in with eyes wide open, so I’m ok with it.

  • http://moneypropeller.com Anne @ Money Propeller

    You did so, so many renos, I’m sure it was rather overwhelming at times. Good call on staying put awhile longer, you can pay down more priciple and save yourself closing costs, etc.
    I like your list of 5 things, lessons well-learned!

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      Thanks Anne! Even though it’s hard at times, I know staying put will be the best decision financially in the long run, and probably emotionally to as I won’t have to deal with a move.

  • http://retiredby40blog.com Retired by 40

    We’re struggling to prioritize renovations, too! It’s so hard to decide timing and priority, as well as make the money side of things happen. It can be so frustrating! Plus, as my husband says, he doesn’t want to live in a half-done house forever…

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      I read an article on apartment therapy about instead of making a GIANT list, just set one task (big or small) to get done for the week or next few weeks. Will definitely keep you motivated and help cut down on the overwhelming feeling. I’ve been trying it lately, and I definitely feel better.

  • http://www.moneyaftergraduation.com Bridget

    It’s been interesting to watch your journey with this.. so many ups and downs. As I’m getting older, I’m starting to warm up to the idea of home ownership but I’m still intimidated by all the costs, especially the unexpected ones (plus houses in my city are ridiculously expensive to begin with, so that’s a huge barrier). Great post though! And happy 1 year as a home owner!!

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      Thanks Bridget! It has definitely been a turbulent ride, but I’m glad others are learning from my journey as well. :)

  • http://www.cashvilleskyline.com Addison @ Cashville Skyline

    If I could go back in time, I would have tried to put down 20% instead of 3.5% for my FHA loan. The required mortgage insurance is brutal and has cost me ~$60 a month! I’ll finally get rid of it next summer once my principle drops below a certain point. I would have saved thousands of dollars if I had put 20% down!

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      True, but are you also calculating the rent savings? My net worth goes up every month when I make my mortgage payment because I have more equity in the home. I also put down only 3.5% and pay PMI, but I felt it was worth it.

  • http://shopmyclosetproject.com Michelle

    Just like Addison, I would have put down 20%. Also, I would never buy in a triplex again-unless I owned the WHOLE BUILDING! It has been a serious pain in the a@@ to agree on things and get things done. I know this experience has been very different from what you originally imagined…but you have navigated it with grace and good humor. Basically, you’ve experienced the crazy road show that is life.

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      Paula at Afford Anything owns a triplex, but she makes everything look easy. Thanks for your kind words Michelle!

  • http://thewalletdoctor.com The Wallet Doctor

    Your point about asking more questions is applicable to a lot of situations. Especially when you are investing a serious chunk of change. Its easy to follow along, but I’ve often found being more inquisitive helps you gain information, and those you are working with take you more seriously.

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      As someone who writes about money…DAILY…I am ashamed I put down that much money and didn’t do more homework. I hope others can learn from my cautionary tale.

  • http://my-alternate-life.com/ Melanie @ My Alternate Life

    I am not a homeowner, but I can relate to some of these in other areas of my life. Asking more or better questions and doing research is SO important when trying out new, life-changing things. Thanks for sharing your journey with us.

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      Aww. You’re welcome.

  • http://debtdebs.com debt debs

    Good points about backing up your gut with facts and research. My sis and BIL hired one contractor based on their gut and getting no other quotes. While I think there’s been no major problems, the cost has doubled primarily because they’ve made changes, but how do you really know? Going from 35K estimate to 70K is a lot! Maybe some contractors work this way and nickle and dime you to death. I’m actually dreading doing our home renovations in four years, which we plan to do before we downsize our home. So any tips I can get are helping me to overcome this fear. Thanks, Lauren!

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      Go with word of mouth referrals. If no one has any, always ask a contractor for references. Then call the better business bureau and make sure they don’t have any complaints. And always get multiple quotes!

  • http://leightpf.wordpress.com Leigh

    I’ve really loved watching you transform your house over the last year! It is absolutely gorgeous, Lauren, and you should be incredibly proud of what you’ve accomplished.

    I bought a two bedroom condo two years ago last month and I’m SO glad I bought a condo. It’s also the perfect size – I just can’t imagine when I will want to move out of it. I have to say that I love not worrying about housing and how much rent will go up. Owning a condo is a great mix of homeownership and apartment living! Plus, the rent savings is amazing.

    • http://lbeeandthemoneytree.com/l-bee-and-the-money-tree/ Lauren Bowling

      Thank you Leigh, that means so much!

Copyright © 2016 · All Rights Reserved · L Bee and the Money Tree