Avoid These Common Home Buying Regrets

Ahouse is a massive purchase that has an outsize effect on your finances and quality of life. Unfortunately, though, the current frantic housing market seems to have served up a recipe for regret for many recent homebuyers.

A shocking 72% of homebuyers who purchased in 2021 or 2022 are reeling with regret over their home purchase, according to a study from Clever Real Estate. The most common factors that contributed to their remorse? Spending too much money and rushing into buying.

A number of buyers purchased a house sight unseen during the COVID-19 pandemic. For most of 2021, mortgage rates were at an all-time low, buyer competition was high, and many buyers found themselves writing an offer (often over the asking price) for a house that was smaller or older than they’d originally hoped to buy. And in 2022, rising interest rates and home prices (which peaked in June 2022) increased the cost of financing the typical home by nearly $750 each month compared with a year ago. In other words, many buyers seemed to be settling for less desirable homes or homes that pushed them to the limit of their budget.

Now, amid the drama of a cooling market and a surge in interest rates, some homebuyers are watching their recent purchases drop in value, which is bad enough. But that stress is compounded as the reality of homeownership settles in, and the price of upkeep and repairs skyrockets due to inflation and rising prices for both materials and labor.

We spoke to recent homebuyers who carry regrets about their home purchase to one degree or another. Read on for their insights and how they’re handling the challenges of homeownership right now.

1. Unanticipated repairs

“I massively underestimated the amount of work required to renovate and modernize the house.”

(Getty Images)

Many buyers who think they’re getting a turnkey home end up with a lot more work on their hands than they had bargained for.

“When I bought my house recently, I massively underestimated the amount of work required to renovate and modernize the house,” says Ollie Creevy, managing director of Free Insulation Scheme. “We need a new boiler, a new roof, a full rewire, asbestos removal, and treatment for mold before we could even think about renovating and decorating the place.”

Like many recent buyers, they now believe they were too fast and loose with inspections while nailing down the deal.

In hindsight, he says he’d have “done more rigorous checks before buying the house, and budgeted more for expenses.”

Creevy has already poured tens of thousands of dollars into a renovation, but believes if he stays the course, he will recoup the losses.

“The only problem is, it would be a struggle to sell if we had to now, and we’d certainly have to finish the renovations before listing it,” says Creevy.

2. A shift in personal circumstances

“I’m spending $20,000 per year on day care alone.”

(Getty Images)

Other hard-learned lessons happen when our personal lives interfere with our living circumstances.

“I bought my house when the market was going crazy in April of 2021, way over the asking price,” says Jordan Dupre, an electrician based in Horace, ND. “I was under a lot of pressure to buy because I’d just broken up with my girlfriend, and this house was in a great location.”

Because the house had an unfinished basement, it was still competitively priced compared with other houses in the area.

As a trained electrician, Dupre thought he could pour his sweat equity into refinishing the basement over time and bring up the value of the home to make it a worthwhile investment.

But some life challenges soon came into play.

“For the past few years, I’ve been working on renovating the house, and I’ve also been a single father to two young children,” Dupre says. “I’m spending $20,000 per year on day care alone.”

Like Creevy, Dupre has also noticed more issues in the home as time wears on.

“The layout of the house is goofy, I get water in my basement, and the windows are drafty,” he says. “I could never go back to renting, but if I could go back and do this again, boy would I!”

3. Fire damage that’s worse than anticipated

We’ve all bought something on sale thinking we’re getting a great deal—only to find the ultralow price was ultralow for good reasons. And when it comes to houses, even bargain-hunting pros sometimes bite off more than they can chew.

“I just purchased a house in Pensacola, FL, that was valued at $850,000,” says Joel Efosa, CEO of Fire Cash Buyers. “It had so much fire damage, I was able to purchase it for $265,000.”

But he underestimated the work that would be necessary to make the place livable again. The smoke damage required the entire house to be gutted, which increased Efosa’s rehab costs threefold.

“Our initial rehab budget was $200,000. Actual rehab was $650,000. We’re in line to take a big loss,” Efosa says.

4. Not following a pro’s advice

“As a real estate investor, one may think that I’m always at the top of my game,” says Jon Sanborn, co-founder of Brotherly Love Real Estate in Philadelphia. “However, this was not the case when I purchased a four-bedroom home with my wife. The house, the neighborhood, and the school district were amazing, but the kitchen was not modern or well-equipped.”

His real estate agent recommended that they upgrade the kitchen immediately.

Post a Comment