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’s just as great at you imagined it would be, but it often involves a lot of very 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 looking back on it, there are more than a handful of things I wish I’d done differently. Here are five (of many) first time home buying mistakes that cost me big time.
Buying Too Much House
I bought a house when I was engaged and expecting the single family home to be for a growing family rather than a swinging single gal. 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 in a nicer area and skipped the renovations altogether.
The relationship was far easier to get out of than the mortgage, so I think the first mistake was buying something I couldn’t manage on my own. I know buying for a current situation rather than a future one feels a bit like betting on the relationship to fail, but better safe than sorry when you’re playing the high stakes real estate game with someone you’re not married to.
I Would Have Prioritized Renovation Projects Like an Investor
It’s the old real estate adage that kitchens are what sell the home, and bathrooms hold their value. Thinking I was making a home for a family I did a bunch of other projects that would only make sense if I were going to stay in the house long term. The game changed, as did my desire to stay in the home longer than necessary and so looking back I wished I’d prioritized the renovation projects with the precise eye of an investor looking to make money.
I renovated the downstairs bathroom instead of the “master” bath simply 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 in my bathroom upstairs, I wish I’d done things 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.
Looking back on it, I was definitely afraid to ask questions during the mortgage and renovation process because I didn’t want to seem unintelligent. I think being young and naive I expected someone–anyone–else to come charging in and ask them for me, not remembering that the biggest part of being an adult is having to have the tough conversations yourself.
Truth time: What you don’t know CAN hurt you and if you don’t ask you’ll never know.
Most importantly, if you don’t ask, no one else will and we’re talking about the most expensive purchase of your adult lifetime. If you neglect to ask your mortgage broker, real estate agent, or contractor something, you could risk losing thousands of dollars, so why take that risk? Just ask the darn question.
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 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.
I know I’m painting a very negative picture, but it hasn’t been all bad. I’ve got a lot of equity in the home to fund whatever venture I want to do next, and I now know all kinds of crazy stuff: like how to hang a light fixture, troubleshoot plumbing problems, and install shelving and closet systems. It’s been a tough journey, sure, but also and incredibly rewarding one personally and emotionally. With the purchase of a home I’m officially adulting, I just wish I could’ve saved myself a little bit of the stress along the way.
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!