7 ways first-time homebuyers can avoid a lemon
That 'perfect house' can have some serious imperfections. Here's what to look for to avoid a big mistake with the largest purchase of your life.
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You've been out looking at homes with your real-estate agent all day. As you walk through the door of the last house on your list, your mouth falls open.
Finally, you've found "The One," the perfect house. Stars shimmer in your eyes. You love the layout, the paint colors and the little powder room by the back door.
You make an offer and move in within the month. It's not until things settle down that you discover that the roof leaks and that the foundation must be replaced — immediately. Suddenly, the stars dim as you face the prospect of several expensive repairs and unexpected home-improvement costs. Not fun at all. (Bing: How much does it cost to replace a foundation?)
Homebuyers, especially first-timers, often are caught looking at the wrong things when they buy a house. They fall in love with all the things that are easy to fix and never think to look at the important clues that the house might be more trouble than it's worth.
What should you do to make sure you're not buying a lemon? Here are seven tips.
1. Check the foundation
A house's foundation is probably one of the most expensive things to fix, which is why you must go down to the basement before you even look at the rest of the house. Do you see any cracks in the concrete or stone? If so, the foundation might be structurally unsound. If the basement is finished, look for cracks in the drywall, especially around windows and doors.
2. Inspect the HVAC equipment
While you're down in the basement, look at the heating and cooling equipment. How old is it? Does it look like it's running properly? Are the vents connected well? These are important questions to answer to make your home energy-efficient and to reduce your utility bills. Replacing a home's HVAC system can cost tens of thousands of dollars, but many first-time buyers never give it a second look.
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3. Look for water damage
If the house has had problems with water in the past, you're looking at several expensive fixes.
First, one-time occurrences, such as a basement leak, can happen again. Second, that water damage could have opened the door for mold, especially dangerous black mold, to grow.
Look for brown or white stains down the side of the basement walls. These can indicate a past leak. If the floor is bare, look for horizontal stains.
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Be suspicious if the basement has been painted recently. Sellers often do this to hide water-damage stains. It's also important to check the bathroom and under the kitchen sink. Look for stains that would indicate mold growth.
4. Check the electrical system
If you are looking at a home built before the 1930s, it still might have old knob-and-tube wiring. It can be a problem, if has been tampered with in any way. For example, if the attic has blown insulation sitting on top of the knob-and-tube wiring, this is tampering — and it's a serious fire-safety hazard. Most insurance companies consider knob-and-tube wiring to be unsafe, so you're going to pay more or be turned down for homeowners insurance if you don't replace it. Replacing it means rewiring the entire house, which will cost tens of thousands of dollars.
5. Look at the house at least twice
Remember, when you first see that "perfect house," you're looking through rose-colored glasses. Always sit on the decision to make an offer and go see the house again a few days later.
6. Get a home inspection
This seems like old advice, but many people still don't get a home inspection before they make an offer. If the home inspector says more research is necessary or files an inconclusive report, get a second opinion.
7. Consider that if the price is too good to be true, it probably is
Trust your gut here. If your dream home's price is suspiciously low, there's probably a good reason.
Beware. Buying a house is a huge decision and investment, especially if it's your first home.
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Don't let first impressions and appearances sway you. Make sure you do your research and watch out for some of these pitfalls.
People out house hunting have a lot in common with people who go out on a rainy night to look at used cars under electric lights on an outside lot.
Free advice is valued at exactly what it cost, nothing.