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Home Buying – Avoiding a Money Pit

– Posted in: Everything Home, home, Managing Your Finances

When it comes to home buying, very few people go in knowing all the traps. The vast majority of folks go out and look for the things they want in a home with little thought about the hidden things that might make it a nightmare. As horrible and salacious as that might seem, it is an unfortunate aspect of home buying that we can’t afford to ignore…ask anyone that bought a money pit.

What exactly is a money pit?

A money pit is simply a home that you sunk an initial investment into, and then continued to have to spend money that was unexpected on top of that initial investment. Sometimes it is simply a lack of foresight…that is, awareness of just how much work had to be put into a home to make it right. Whether the money pit is hidden or right out front, there are no shortages of people diving in. The key is to not be one of them.

How do I avoid a money pit?

The simplest way to do this is to pay an expert to come in and check the house from top to bottom. Even these “experts” can get it wrong but if you are careful to find one that is highly recommended you can save yourself thousands. These are people that will come in and check the things that we generally would not think about.

If you can’t afford to pay an expert, here are some things to watch out for.

Start with a budget in mind

If you are buying the house for long term living, know what you want to sink into the property. Take away the mortgage and expenses and look at the home with that figure in mind. If you see more repairs than your budget can handle, walk away and never look back. The things you do see are rarely the only things there. Assume there will be unexpected expenses along the way. You have to budget that.

Pay close attention to the heating/cooling systems 

This is a common expense that many people overlook. They see that there is one and leave it at that. Find out how old the system is and how the air is pumped through the home. How is the insulation? What about the windows and doors?  All of these things will add up and cost you money after the purchase if they are not good to go.

What about the water/plumbing?

Again, this can be hidden behind cabinets and flooring, but extremely expensive to fix if they are messed up. Check the plumbing out carefully and ask about any leaks or flooding. Hidden damage can be covered up by criminals, so make sure you see it for yourself.

Electrical systems are important too

Go through each area of the home and make certain that the electrical wiring is in check. Look for burned plugs, loose wires, or any other signs that something might be astray.

Foundation problems

When you have problems with the foundation, you can pretty much count on major trouble. Look for larger trees near the outside of the home. Big trees near your home often means big roots that can crack a foundation. Look around the inside and see if you notice any floor cracking or wall cracks.

Finally, consider the changes that you will want to make. If the home has  a den that you would love to turn into a larger bathroom, that should be figured into the planning and budgeting. No home is going to be cost free, but these major areas are too important to be ignored. Make sure you address them, and you will not ever have to worry about falling in a money pit.

 

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18 Comments… add one
Robin (Masshole Mommy) December 21, 2013, 5:58 am

Awesome tips. I was lucky when I bought my house because the people that had it before me, re-did the entire house. They bought it to fix it up and re-sell.

Terry December 21, 2013, 8:26 am

We just bought a different home 7 years ago. Thank goodness I am not looking to move anytime soon. Checking for foundation problems is something that is so very important. If you don’t have a good foundation…. You may not live there long.

becca December 21, 2013, 2:11 pm

we bought our home a few years back and are just now atarting to hit the principal when making payments

Aisha Kristine Chong December 21, 2013, 8:06 pm

Thank you for these tips – it will definitely be helpful for me in the future.

GossipMoms (@GossipMoms) December 21, 2013, 8:08 pm

These are some great tips, thanks so much , i will be using these tips when we buy our next home

Tess December 21, 2013, 8:52 pm

We are looking for a new house and now that I’m experienced to know what to look for now, I hope to get a safe one.

Lawna December 21, 2013, 9:21 pm

Very helpful tips. I was just talking about buying a house earlier but unfortunately we don’t have the funds nor the credit at the moment. Definitely good tips to know though.

Trista December 22, 2013, 12:47 am

Great tips on saving money and budgeting! Thanks for sharing!

Robyn December 22, 2013, 12:59 am

Great tips. Will keep this in mind when buying a home.

Ronnie December 22, 2013, 2:42 pm

GREAT tips. So many people are unfortunately fooled into buying what seems like a great deal or home, only to later realize that they need to invest heavily into it. Everything you mentioned is incredibly important to check before making any purchases!

Pam December 22, 2013, 7:26 pm

Those are great tips. We checked out house out carefully before we purchased it and had no major surprises.

Jennifer Williams December 22, 2013, 7:38 pm

Great tips – We were somewhat lucky with the house my husband purchased, it is in great shape and we got it as a foreclosure so it was a great deal on it. However if my husband would have listened to me when I said I hated the house and not to buy it, I would have been happier!

Tough Cookie Mommy December 22, 2013, 8:55 pm

As a homeowner myself, I think that these are some great tips for those looking to buy. It’s important to educate yourself before making such a big investment.

katherine December 22, 2013, 9:22 pm

These are really great tips. I haven’t bought my house yet but I’ll keep these in mind.

Ashley Gill December 23, 2013, 8:45 am

These are some great tips! Recently my parents bought a house but they couldn’t afford to have the inspection done, so they just went forth with it all hoping the house was in good order. Overall, they’ve been pretty lucky.

amanda December 23, 2013, 9:31 am

Very true. Nothing worse than a dream house turning into a nightmare.

Le-an Lai Angeles Lacaba December 23, 2013, 11:08 am

Great tips. We’ve never bought a house before since my father likes to build houses from the ground up, but this would be a great reference someday

Karen Glatt February 18, 2014, 7:27 pm

I made a big mistake when I moved into my money pit! I did not make sure that the heating system worked! It took me years to get it fixed because I was strapped for cash! Replacing a heating system costs tons of money!!

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