Regrets? Home Buyers Have a Few
NEW YORK ( TheStreet) -- Regret over a home-buying decision is so prevalent that one real estate firm has a Real Estate Regrets survey designed to highlight "mistakes" homebuyers should avoid during the spring buying season.
That jibes with Wednesday's announcement by the Mortgage Bankers Association that home mortgage applications rose 4.8% last week, although refinancing applications make up 75% of those new applications.
But the more activity in the market, the more regrets consumers seem to have. For instance, the pressure that comes with a highly active market seems to rush home consumers, leading to mistakes.
"As prices rise in 2013, buyers are impatient while would-be sellers are holding back," says Jed Kolko, chief economist at Trulia. "Faced with limited inventory, many buyers will feel pressure to act fast -- but snap decisions often end in regrets. Homeowners' biggest regrets are wishing they bought a bigger home and wishing they remodeled more. Many buyers would have fewer regrets if they waited until they were in strong enough financial shape to afford a house that really meets their needs."
By and large, the biggest regrets involve homeowners wishing they could do more.
"Although the recession, tight credit and foreclosures have lowered homeownership in America, people would still buy -- and buy big -- if they could," he says. "Many current renters wish they had bought, but very few current homeowners wish they had rented. Furthermore, homeowners are three times more likely to wish they had purchased a larger home than a smaller home. Even after the housing crisis, Americans' main housing regrets are that they didn't invest more in their homes."
Another major regret is buying a home based on price instead of one that inspires passion. That's why home consumers should really lay some groundwork, especially on how much they can really afford in a new home.
"In today's competitive, low-inventory housing market, consumers may find themselves giving in to homes they don't really love," says Michael Corbett, a spokesman at Trulia. "Fully prepping for the future will help you lock in a home type and size that you truly want and will feel good investing for."
Overall, 52% of Americans have at least one regret tied to the purchase of their home, starting with 42% of renters who wished they'd bought. (And the rate of those rates are on the upswing, rising 12% over the past 10 years.)