Buying a home is one of the biggest financial decisions you’ll make, and even a single misstep can cost you thousands—or even your dream home. In today’s video, we’re diving into the top five mistakes buyers make. Whether you’re a first-time buyer or experienced homeowner, these common missteps are worth avoiding in 2024, 2025, and beyond.
My name is Scott Himelstein with the Scott Himelstein Group. Based on real-life experiences and conversations with our lender partners, these insights can help you sidestep costly errors in the current housing market. If you find today’s content helpful, please subscribe to stay updated on more real estate tips!
1. Buying Down the Interest Rate Too Soon
With rising interest rates, many buyers consider buying down their interest rate to reduce monthly payments. While this can seem appealing, it often isn’t worth it. To lower your rate by 1%, you might need to pay 1% of your loan amount upfront. For example, if you have an $800,000 mortgage and pay $8,000 upfront to reduce your rate by 1%, you’ll save about $128 monthly, which takes over five years to break even. Since interest rates may drop in the next few years, you could end up refinancing and lose the benefit of that initial investment.
Before deciding, calculate your break-even point. If you’re comfortable with current rates and confident they’ll drop, consider holding off on a rate buy-down and refinancing when rates decrease.
2. Waiting Until the Last Minute to Shop for a Loan
Shopping for a loan should happen early in the buying process, but too often, buyers wait until they’re close to escrow or under a tight contingency deadline. This limits options and makes switching lenders more difficult.
We recommend comparing rates and fees from multiple lenders early on, ideally before making an offer. Checking rates from different lenders on the same day will give you a true “apples to apples” comparison, as rates can fluctuate daily. By shopping early, you’re setting yourself up for success and potentially securing better terms.
3. Not Negotiating Buyer’s Agent Compensation
Buyer’s agent compensation is often negotiable. While some buyers hesitate to ask sellers to cover this cost, it’s worth bringing up. If you’re offering $500,000 and ask the seller to pay $15,000 for your agent’s fee, they may initially decline. However, you can negotiate by adjusting your offer or exploring other options. For instance, increasing your offer to $515,000 might make the deal more appealing to the seller while covering your agent’s compensation. Don’t be discouraged if your first request is declined; negotiations often have room for flexibility.
4. Walking Away from As-Is Properties Too Quickly
When a property is sold “as-is,” buyers sometimes assume the seller won’t address any issues. However, once you’re under contract, you may have some leverage if inspection reveals significant problems. Many sellers are open to making repairs or offering credits if they believe future buyers will request the same adjustments. If you find a home you love that’s listed as “as-is,” don’t walk away too soon—use the inspection process as an opportunity to negotiate for necessary repairs or credits.
5. Waiting for the “Perfect” Time to Buy
Some buyers hold off on purchasing, hoping for a market shift. But timing the market is tough—even seasoned investors struggle with it. Market conditions—interest rates, prices, and inventory—fluctuate constantly. I’ve had clients who sold in 2019 anticipating a downturn, only to watch prices skyrocket during the pandemic. They’re still waiting to buy while prices have climbed higher.
My advice? Buy when it’s right for you personally. Ensure you’re comfortable with the monthly payments, have emergency funds, and plan to stay in the home for seven to ten years. This strategy offers stability, allowing you to weather market changes over time.
