Top Five Home-Buying Blunders for 2009

US News lists the top five home-buying blunders of 2009 as follows:

1) Buying for the short term: With home prices at the national level expected to continue declining throughout most of next year at least, 2009 won't be a good time to try to turn a quick buck in the real estate market. Many homes that are purchased in 2009 will lose value in the short term.

2) Not understanding what's happening in your local market: Although it's easy to get caught up in the gloomy national housing trends, prospective home-buyers should be paying more attention to what's going on in the market where they are considering purchasing property.

3) Not scouring for deals: With the fall in home prices expected to continue for some time, 2009 will be a buyer's market. As such, people considering purchasing a home should understand that they are in the driver's seat and be on the lookout for deals.

4 ) Purchasing a foreclosure just because it's cheap: While foreclosures can offer home-buyers big discounts, such properties sometimes come with a great deal of baggage.

5 ) Overly aggressive buying: Even if you've found the perfect property, make sure it is something you can reasonably afford.

As a person who's in the house-buying market (and who may actually get a place in 2009), this piece was quite interesting to me. Here's my take on the list above:

1. It's interesting that they think home prices will keep going down through 2009. If this is the case, we shouldn't be in a rush to buy a new place. That's really nothing new for us. We've been looking for two years, so nothing has rushed us yet. ;-) That said, if we found a place, we'd certainly want to live in it for quite some time, so the time element they discuss here is not an issue for us.

2. After two years of looking, endless online searches, and seeing 50 different homes, we're pretty familiar with the local market. Unfortunately, most sellers aren't. Many are still holding on to two-years-ago pricing -- and thus their homes are just sitting on the market. Wonder if the dam will break in 2009.

3. Oh yeah, we understand we're in the driver's seat alright -- that's why we're even considering a move! Plus we're very attractive buyers (high credit rating, good down payment, no debt, etc.), so we have all the cards in our favor. Of course, you still need a cooperative seller to make a deal.

4. Of course. You don't want to get a "great deal" on a place just to discover it's on top of a toxic waste dump. We'd only buy a foreclosure after a complete inspection.

5. Again, a no-brainer. Unfortunately this wasn't common sense for many buyers the past five years, and it's one reason we're now in this housing mess (people bought homes they couldn't afford.) But my formula for buying a home ensures we will only buy something easily in our price range.

Comments

[nadia]

These are simple yet effective tips to work toward buying a home the smart and informed way. I'm looking to buy a home this year and am saving every penny! I'll take all the help I can get.

[Ron]

You are correct that alot of people are hanging on to the prices of 2 years ago. Myself I have decided what I want for my home and if I get it that's great if not oh well then I will keep it until I get my price. Since it's paid for and my monthly costs are very low I can afford to set on it for as long as it takes. But I do not believe that the prices will continue to fall though because I am seeing them rise somewhat and I am right in the middle of the worst foreclosure area of California.

[thomas]

Definitely things to look out for. Foreclosures can be huge successes or the biggest pain in your ass imaginable.

[FFB]

Great advice. We're looking into getting a home this year. We almost need one anyway so the current market will hopefully make it easier for us. We need to get out and check out the areas we're looking at to get a better idea of what's there and what people are asking.