We are sometimes enthralled by the presentation of a property, but ignoring the things we cannot see or overlooking obvious problems and risks can lead to disastrous consequences. To the extent possible, put your emotions aside and make buying property a business decision based facts and data.
Getting Too Attached To A Property
Impulse decisions in real estate can cost major dollars and can have life altering effects. If you fall in love with a house, you may be tempted to waive conditions or pay more than planned in the rush to close the deal. The problem is, when we get too emotionally attached, we keep altering our "walk away" price to the point where it doesn’t exist. Set a threshold and when you past it, walk away.
Knowing What You Can Afford
It's important to put optimism aside and truly understand your financial position, now and in the future, so you don't overextend yourself. Life changes (unexpected bills, children, rising interest rates, unemployment) will affect your cash position, so you need to know what you can afford. Meet with your financial adviser to establish your budget before entering the market and stick to the plan.
Being Tempted By Cheap Properties
Cheap properties may seem attractive, but they usually come with risks. Chant the maxim, "if it’s too good to be true, it's too good to be true," when considering these properties. Then, find out why the property is listed at such a low price. In these instances, vendors may be desperate to offload their properties because of serious concerns like structural flaws or pest infestations. Finally, decide if you will accept these concerns in return for the cheap price.
Understanding Property Negotiations
Most sellers have some built-in buffer for negotiations, so the key is finding the lowest price at which the vendor is willing to sell. But, it can be difficult to remain logical during negotiations since you're bidding on properties you really like. An attitude of indifference is likely to secure a better price than if you appear anxious. And, never allow your emotions to interfere and become insulted by the seller's position or counter offers. They are trying to get the best deal they can, just as you are.