Mistakes to avoid when buying a house

By Loren C. Davis

This time of the year offers the best opportunities if you wish to be a home buyer. Starting around Thanksgiving and running through "mud season" is generally the slowest period for real estate sales. There are exceptions such as slope-side ski condos and other vacation homes. However, most people don't move during the winter or, if they have children, during the school year.Buyers also have the advantage of a wide selection of homes from which to choose due to new construction in the area this past summer. Added to this are the many existing homes that have come onto the market. Better yet, prices have been dropping since mid-summer and the real estate market is still going through a price correction. With the market in the buyer's favor, there are some pitfalls that buyers should still avoid: Don't start shopping until you know what you can afford: It's simple and easy for buyers to get pre-qualified for a loan by local lenders. There is no charge for this service until buyers actually make a formal application. Making the mistake of not knowing the local market: The old advice of not buying the first house you see still holds true today. One should view many houses in one's price range to get a feel of the market. Some homes may be over-priced and the best way to determine value is to see what else is available. Failure to have your own buyer's agent working for you: There are many agents in the area who are qualified to work as "buyer brokers" or "buyer agents." Work with the seller's agent and you are not likely to see many other competitive properties in your price range. Buyer's agents also do research and provide information helpful for you to make decisions. Making the mistake of not including reasonable contingencies in your purchase and sales contract: If you are not paying cash, you must include a financing contingency. Beyond this, there should be a home inspection, water and radon tests, and a contingency to allow the buyer to review deed restrictions, covenants and association rules. Not knowing what similar properties have been selling for in recent months: Informed buyers need to know what properties in the same area/town have sold for, and their buyer's agent should be able to provide this information before they make an offer to purchase. Owning two principal residents at the same time: Unless, you are prepared to carry the expenses of two homes at the same time, you must plan to have your first home sold, or under contract, before entering into a binding contract for the second. One alternative is to have a contingency, as a buyer, that the sales contract is subject to the sale of your existing home. In a slow market, sellers are more likely to agree to such a provision.If you think you may want to be a homeowner in 2006, now may be the best time to prepare yourself as a buyer. There is more available on the real estate market than in recent years and interest rates are still relatively low. Because a home purchase is often the largest investment most people will ever make, they need to be sure that they know what they can afford, what is available in their price range. Before buyers become owners, they need to know what their monthly expenses will be and what maintenance and repairs will be needed. Having a competent agent working with you is one of the best ways to avoid costly mistakes.Loren C. Davis is owner and founder of Buyer Representatives of Northern New England. He has been a member of the White Mountain Board of Realtors for 13 years and has practiced Exclusive Buyer Agency since 1997. He is past president of the New Hampshire Association of Exclusive Buyer Agents and has earned the coveted Accredited Buyer Representative (ABR), Graduate Realtors Institute (GRI), and the Graduate Buyer Representative (GBR) designations. He may be reached by phone at (603) 447-1329 or 1-800-741-5091. Web address is www.BuyerRepNNE.com.