Finally after a little bit of work every day for months, loads of revisions and “that’s not what I thought I said” from the haze of pain medications because of a back injury, my latest book has arrived at Amazon at the end of November 2018.
So, WHAT COULD GO WRONG when you buy house? What mistakes do people make? How can you reduce the risks?
Buying a house starts with a sense of excitement, awe, hope and is probably the biggest investment you are going to make in your life.
In the good old days, the bank used to share the risk with you but since the GFC, most banks have become risk averse and loans tend to be structured so that if things go wrong and you can’t keep up the payment, THEY WON’T BE OUT OF POCKET. Why, because they were, banks lost billions on real estate loans, in some cases people just walked out of their homes.
You’re probably aware that it still happens. Do you find it interesting that there are websites dedicated to helping people get great deals through foreclosure?
Why do you buy a house? For us, it was about security, pretty much the only thing they can’t take from you (as long as you can make the payments). A safe place for our family and probably the only asset you can own that will increase in value.
Did I say increase in value? Well in the long run that is true. In many countries, if you go back in history you will be able to see that over say a hundred years, properties double in value roughly every 10 years. But what happens in between?
Real Estate markets fluctuate dramatically in between those long term cycles. Whether you are in the USA, Canada, UK, Australia or New Zealand, property is being impacted by all sorts of things that are out of our control. Politics, lending rules, climate change, urban sprawl, Baby Boomers leaving the cities, migrants from other countries, property flippers and more.
What hasn’t changed fundamentally?
- Most houses are sold on behalf of the vendor by a Real Estate Agent
- Real Estate Agents are highly trained in how to sell
- Home buyers typically have little or no training on how to buy
- Banks want to lend you money, but they don’t want any risk
- You need to borrow money and without training are carrying all the risk
- Everyone around you has an ‘opinion’ and if you dig in, many people offering opinions have made similar mistakes and possibly won’t get it right next time either.
I am a big fan of Dan Ariely, a famous writer who says that humans are predictably irrational. I agree with him. He talks about financial decision making in this TED video.
Dan suggests that we have an illusion of making a decision, but most of the decisions are made for us by external influences. Making decisions, like buying a house, are complex, so complex that we don’t know what to do.
In this eBook I provide one ‘SECRET’ that alone is worth tens of thousands dollars to you. I say it’s a secret because almost no one uses this, or even thinks about it probably until long after they have bought a house. Chances are, if you have bought 2 or 3 houses, you still haven’t used it. It took me four.
You would probably rationalise and say “I had too much on my mind, so much information coming at me, Real Estate Agents pushing FOMO at me, the bank, the mortgage broker, the lawyer, my partner, his or her family…..”
We don’t know what to do and in the end, we just DO SOMETHING and hope we got it right. Isn’t that interesting? Think about it. The most expensive investment we will make in our lives, the greatest risk we make in our lives and we end up so sick and tired of the process, that it almost becomes like throwing a dart on a map and seeing where it lands!
But once you pick up on it, it is so obvious. Why don’t you do it? Because you haven’t read this book yet.
But wait there’s more! The book covers 4 more mistakes and provides lots of answers to help you make informed decisions before you even start looking at specific houses.
What’s your time worth? This short book took several months of my time. I just wish someone had written it I bought my first home, or my second, my third or my current one. It’s ironic that I’m writing this from my fourth home. What’s changed?
I had time to think about it, to read, watch videos, talk to people and do research. You don’t usually have that time.
This book won’t take you long to read. The things I tell you to do are easy. Maybe that’s why you didn’t think of them. Sometimes the answer stares you in the face as you run headlong into…………………………..