Buying a house is one of the most important decisions and probably the main investment in the life of most Italians and, nevertheless, the same mistakes are frequently made. Buying a home means making a big economic effort and sometimes, you commit yourself for most of your life.
After years of crisis, the real estate market is catching its breath. In fact, in recent years, there has been a recovery in sales and the banks have started to disburse. These factors, combined with the mortgage rates that continue their descent, can make this the right time to venture into buying a home .
Discover with idealist what to check to avoid deadly mistakes:
1. Accounts are generally not done well . In Italy, according to various international studies, we have no financial culture. Buying a home is the biggest investment for many Italians, yet we do not have adequate financial preparation to deal with it.
2. Many people forget that about 10% is added to the price of the property . In addition to VAT (if the house is new) or registration tax (if the house is second-hand) there are land registry taxes . Without forgetting the possible down payment, which, although recovered (we do not go down here in the problems that are created when we do not recover), is still a disbursement that is not trivial.
3. We do not take into account the mortgage , which also involves expenses and taxes. The mortgage tax is generally 2% of the loan amount, without forgetting that many banks want mortgage insurance, which is used to protect against risks such as loss of employment or death of the contractor. It is useful, but it costs, and not a little.
4. Taxes and extra charges . The buyer forgets that being a homeowner means paying condominium fees every month and other extras that can increase the price considerably. The houses need maintenance, not to mention the common costs (facade, antenna, elevator, etc.). In the case of an independent house, the costs are even higher.
5. Money for furniture and unexpected events . When you make (or you should do …) a budget, you do not add the costs for furniture and you do not calculate an extra fund for the unexpected that do not have directly to do with the house, but that they can send in crisis a family budget (such as breaking the car two months after buying a house).
6. Do not request a property tax report . 99% of the people who buy the house do not inform themselves in advance about the fees to be paid.
7. Do not deal with the Euribor in the case of a variable rate mortgage. If the Euribor is at the minimum, it is necessary to come to terms even when it is at its highest.
8. Ask for a mortgage with long deadlines . Over 25 years it is not convenient to buy: by calculating all the interests the house becomes too expensive.
9. Make debts over 30% of your income . The Bank of Italy recommends that the loan quota, added to the rest of the debts (the car payment, credit card, personal loans) does not exceed 35-40% of the income of the mortgage holders.
10. Ask parents, friends or relatives for guarantees . Those who decide to buy a house should take responsibility. If the situation gets complicated you will drag other people into your problems. If you can’t afford the house right now, don’t buy it.
11. Often the buyer loses the sense of what expensive or cheap means . Look for statistical information and compare market prices. Information can be found in many ways, from the agency of the territory to the reports of the Bank of Italy, but also through the real estate portals.
12. Many buy a house thinking that prices always increase . The latest experiences have taught us that houses do not always increase in value, but it seems that not everyone wants to understand it.
13. Do not listen to agencies . Right now you can save money through an agency. You can negotiate and the agents know it well. This is why they may have more room to lower the price and convince the seller of substantial discounts.
14. Do not negotiate the price until the end . Many potential buyers discard some properties because they think they cannot negotiate on the price. Prepare to bargain and always have a counter offer available, but always after having reckoned. Another mistake is to accept a half-price price for fear of losing the house. If your budget is 180 thousand euros, for example, don’t move from there. If that’s not enough, it’s not the home for you.
15. Let yourself be transported on an emotional level . Sometimes buying a home is a more emotional decision than a rational one and the purchase is then wrong. If you feel tired or unmotivated after months of research, it will be easier to decide wrongly. Take a time to reflect.
16. To think that prices will not fall and therefore rush. There are still no obvious data that speak of a generalized price recovery, but only some partial data that confirm that certain areas have held. If the center of Milan or Rome has increased, it is not certain that the same will happen on the outskirts.
17. Speculate on the house . The house must be a commodity. If we buy it to live in it is a relative problem, since, at least, it solves the problem of housing. But if we buy it to speculate and then things go wrong we will have destroyed our finances for many years.
18. Do not consider whether it is worth living for rent . In Italy, the culture of ownership is deeply rooted. Living in rent is instead an option that many do not even consider. Make the accounts and think about the possibilities that the rent gives, such as greater ease in changing jobs and changing cities. If the economic difference between the property and the rent is important, a pension fund can be made with the savings.
19. Buying a home is not like buying a car . It is a decision that can have repercussions on the next thirty years, a time frame in which anything can happen: births, deaths, divorces, job opportunities in other states or in other cities.
20. Do not consult the notary before signing important deeds as purchase proposals and sales preliminaries. For example, not everyone knows that donated goods are subject to the revocation action of any defrauded heirs of their rights. For this reason, many banks do not grant a loan for the purchase of a property from a donation. In this as in other cases the opinion of an expert can prevent any nasty surprises.