Discover essential strategies to prevent buyer’s remorse when investing in property, ensuring your investment is both secure and rewarding. File photo.
Property is often seen as one of the safest and most rewarding investments, offering both the potential for growth and the security of a tangible asset. However, it can also be a costly mistake, one that’s not easily undone.
“Whether you're buying a home to live in or an investment property, real estate can offer stability and financial benefits that other investments, like stocks or bonds, might not,” says Yael Geffen, CEO of Lew Geffen Sotheby’s International Realty. “But with the complexity and high stakes involved, it’s easy to fall into the trap of buyer’s remorse.”
Geffen explains that excitement or the fear of missing out can lead buyers to make hasty decisions. “It’s all too easy to regret a purchase later, especially when hidden issues or unforeseen costs emerge. Unlike other investments, selling a property is not simple, and it may not even be possible to recover your money.”
Fortunately, buyer’s remorse can often be avoided with proper research, professional advice, and careful financial planning, he says.
The first step is to know exactly where you stand financially. “Buying property is exciting, but you must ensure you can afford it not only now but also in the future,” says Geffen.
Start by getting pre-approved for a bond to know your borrowing limits. Don’t forget to budget for additional costs like property taxes, maintenance, and potential renovations.
“Don’t stretch your budget too thin, no matter how appealing the house seems. A solid financial plan will keep your emotions in check during the search.”
According to Geffen, before making a purchase, be clear about your goals. Are you buying a home to live in or an investment property?
“If it’s an investment, consider factors like rental income, resale value, and local market trends,” says Geffen. “If it’s your future home, think about your long-term needs, such as proximity to work or schools and space for a growing family.”
“Thorough market research is essential,” Geffen says.
He says check whether property values in the area are rising, stagnating, or declining. Look into planned developments that could impact prices, and consider the demand for rentals if you’re investing. Understanding the market will help you make informed decisions and avoid overpaying.
Geffen highlights several red flags to avoid:
Poor location: A declining neighbourhood, noisy roads, or lack of amenities can hurt the property’s value and desirability.
Structural issues: Cracks in the foundation or visible water damage can indicate costly repairs. Always get a professional inspection.
Water damage: Signs include discoloured walls, musty smells, and standing water in the yard. These issues can lead to mould and expensive repairs.
Overpricing: Research similar properties in the area to avoid overpaying.
Outdated or unfinished renovations: Kitchens or bathrooms in poor condition can lead to unexpected costs.
Unapproved additions: Renovations without proper permits can result in legal and financial headaches.
Roof problems: Look for missing or curling shingles, sagging areas, or water stains, which could signal expensive repairs ahead.
“By consulting an experienced property professional and doing your homework, you can avoid common pitfalls,” Geffen concludes. “With the right preparation, you can make a smart investment that meets your needs and grows your wealth over time,” says Geffen.
PERSONAL FINANCE