Purchasing a house is supposed to be an exciting time in a person’s life. The feeling of saving up for years and finally putting a down payment on your dream home can be a rewarding experience, as you finally have a place to call your own.
Finding out that you may have actually overpaid for your home, however, can come as a bit of a shock and can really put a damper on your living situation. Unfortunately, this is something that happens to many people, and finding out after the fact can be upsetting. If you’re concerned that you may have overpaid for your home, here are a few ways you may be able to tell.
Determine how long it had been on the market
If your home had been on the market for a long time, that could be a sign that it was listed at a higher price than usual. If your home was listed for significantly more than similar homes in your area, your suspicions may very well be true. Before jumping to conclusions, however, it is important to note the details of your home that may have led to a higher listing price. The size, property type, and additional features, such as an inground swimming pool, can cause a house to be listed at a higher price than other homes in the area. If you’re still skeptical, a quick Google search for “what is my home worth” can give you peace of mind and help you understand your home’s value.
Consider your neighborhood
A situation that many people often find themselves in is overpaying for a nice home in a not-so-nice neighborhood. The truth is, a nice home in a bad neighborhood could actually decrease in value over time, as opposed to an older house in a great neighborhood. However, this doesn’t always mean that purchasing a home in a less-than-stellar neighborhood is always a bad idea. If a neighborhood shows signs of promise, such as new business or community growth, it may be worth the investment. It is important that you assess this for yourself to determine whether or not you feel that you overpaid for your home.
Were your expectations too high?
One of the biggest ways that many people get in over their head and end up overpaying for their home is by having too many expectations upfront. Did you purchase a home with more bedrooms than you needed “just in case” you decide to expand your family? Did you spring for the home with the inground swimming pool and hot tub expecting to use them regularly? Oftentimes, we try to justify spending more money than we’re comfortable with on something by telling ourselves it makes sense, or we will get a lot of use out of it. Chances are, you’re not going to be using that swimming pool as often as you may have thought, so next time, save your money by keeping your expectations more realistic.