The last thing you want to do is regret buying a house. It’s typically the largest purchase you make, and something you have to live with (and in) for some time.
But people regret buying houses so often, it has a fancy term that gets thrown around—“buyer’s remorse.” Whether it’s that they feel like they spent too much money, they bought in the wrong neighborhood, bought the wrong house, or worry that the house is too small, it’s common for people to regret buying the house they bought.
It happens in any market, not just a fast-paced one like we’ve seen recently driven by the pandemic, low inventory, and low mortgage rates. But this market certainly hasn’t made it easy to avoid buyer’s remorse as The New York Times points out in this article.
The problem is, many buyers just don’t prepare themselves to be well-informed, confident buyers in whatever market they happen to be buying.
Fortunately, you can avoid buyer’s remorse, and not just in a “hot” market. Here are some things you should do to avoid it:
Know your numbers — Know how much of a mortgage payment you can afford to comfortably spend per month, considering all of your expenses. Then simply make sure that whatever house you buy will cost you no more than you’ve already figured out you can handle per month. Half the battle is being comfortable with how much you’re spending per month, which sounds basic. But many buyers just don’t think it through enough upfront and end up figuring it out once they’ve bought a house and it’s too late. This also helps keep you in check from over-bidding when you’re up against other buyers or in a fast-paced market.
Know your mortgage options — Getting pre-approved for a mortgage is an important first step many buyers actually don’t do until they “find the right house.” That’s a huge mistake. You should really get pre-approved before you even start looking at houses because without doing so, it’s almost impossible to “know your numbers” as stated above. But beyond that, take the time to know the different types of loans you qualify for, and hone in on the best type of mortgage for your short and long-term financial goals when owning a house.
Know your wants and needs — Make a list of the things you absolutely need to have in a house and a list of things you want. Though it may seem like a fine line, there’s a difference, and having a handle on what you need (versus what you want) will help you during your search—and long after you’ve bought the house. Don’t just toss it in the trash once you’ve bought your house; use it to refer back to if you’re ever feeling like you regret buying your house. As long as you stay true to your list, you shouldn’t have any regrets. Sure, you may have had to bend a little here and there, but knowing what you needed and wanted is helpful in staying focused on getting as much of it as possible…and appreciating it.
Know the market — You need to know and understand the market to make sure your needs are reasonable and achievable, and how likely it will be to find what’s on your “wants” list in a house within your price range. You don’t need a degree in statistics and probability, but it’ll help you to see if what you’re hoping for is in line with what you can expect to find.
Know a good agent — While you can certainly do a decent amount of research online nowadays, there’s no substitute for having a good, local agent—one who knows the market and can help you digest the data and assess if what you want and need is reasonable. A good agent will also help keep you in check mentally, emotionally, and financially throughout the process.
Know what you’ve got — Once you’ve bought a house, stop looking at other houses! Appreciate the one you bought and focus on everything it does have, rather than what it does not.
It can be hard to keep yourself in check mentally and emotionally. Find and work with a real estate agent who:
Will educate you thoroughly about the market and refer you to mortgage experts who can guide you on your mortgage options.
Is patient and will help you remain calm and objective and certainly not push you to make rash decisions.
Will tell it like it is. While you don’t want a pushy agent, you also don’t want one who won’t give you the truth or a nudge when needed.
Will be there for you even after you’ve closed on your home to listen to any regrets you may be feeling and help you manage your emotions and see things clearly.