Home Buyers Remorse: Selling after one year

HomeownersA few weeks ago I heard that a couple I know put their home up for sale after just one year of becoming homeowners. They bought a home in the same town as me a few months after I did. They were first time home buyers as well. Their home was a short sale and had several offers on the table but they were still able to buy it at a low price which appeared to be a great deal for them.   I started wondering what happened? Why are they selling so soon?  I found out later that they have encountered several issues that many first time homeowners sometimes don’t realize.

 

Flood Zone

Their home is in a flood zone and their home insurance is very expensive, about $2,000/year.  This is a big issue and I don’t know why they didn’t back away from this home when they found out about this.  If you’re in the market for a home make sure you know if the home is in a flood zone.  When I bought my home this was one of the first things my real estate lawyer made sure to check and we had a clause in the contract to protect us where we could back out of the deal if the home was in a flood zone.

Home Maintenance and Related Costs

The harsh winter was another issue that pushed them to sell so soon.  They were not really expecting so many snowstorms and the constant shoveling of snow really put a toll on them.  This couple is in their late 40s so I can see how this could be an issue and the husband travels a lot so the wife was the one constantly shoveling snow alone. The very cold weather conditions and the Polar Vortex added to their heating costs as well.  Many of us suffered from this this winter season.  It was no joke.

They also felt that the house was eating up a lot their monthly income.  After putting in a new bathroom and a fence around the property they really fell out of love with the home.  They felt it was just too much money being pulled out of savings and they didn’t want to continue down that path by upgrading the rest of the home. They are also not big DIYers and really don’t enjoy the constant maintenance work on the home. They were just not fans of spending so much time and money on home updates and maintenance.  It’s not easy going from calling your landlord for repairs to being in charge of all the maintenance yourself.

High Mortgage Payments

Though they bought the house at a low price they only put a 5% down payment.  So, with the extra costs for PMI and the high cost of home insurance, add to that the property taxes, I can see how they probably are not seeing much of an advantage to owning in their case.  In addition, the wife is now only working part-time after loosing her job at the end of last year.  I’m sure this has made it more difficult to keep up the mortgage payments and maintenance costs.

All of these issues have caused them to have home buyers remorse after one year.  It’s unfortunate, but it happens to many people.  Probably the biggest issue this couple had was buying a home when they were not ready to be homeowners.  Perhaps they were lured in by a low price and probably low-interest rates at the time.  I’m assuming they did not have much knowledge about the issues involved when buying a home in a flood zone either.

Being a first time homeowner comes with a big learning curve for many, myself included.  I hope this couple is able to sell their home soon without losing too much on the deal.   So far they have had to drop the selling price by $6,000. Now that the prime season for selling real estate is here they may find a buyer before having to drop the price again.

Have you ever had buyers remorse after making a large purchase such as a home or a car? 

Photo by: Flickr

 

Comments

Home Buyers Remorse: Selling after one year — 33 Comments

  1. I hate hearing about these situations, but they typically happen when you make your investment based on emotions more than facts. I have had to counsel people out of buying a home because even though the bank and realtor convinced them they could “afford” the home, when you look at the ongoing costs of home ownership, you really need more robust savings before you make the decision not just enough to get you to the closing table.
    Shannon @ Financially Blonde recently posted…Music Mondays – I Need a HeroMy Profile

    • Yeah, I think they got swept up by the low interest rates and lower home prices in the area. I hope they don’t lose too much when they finally sell.

  2. I had buyer’s remorse after we purchased our house. I got over it but it was a huge shock. It took awhile to feel comfortable with the house. At first, every little thing that broke or needed fixing would cause me to panic. Now we’ve adjusted our budget and savings so that we are prepared for repairs and replacements.
    Liz recently posted…Greek Salad RecipeMy Profile

    • Yes, I think the first year is the worst. I felt the same way but now things have calmed down a bit and we have also reworked our budget to cover maintenance and additional costs.

  3. It does sound like they weren’t ready to be homeowners, and that they might have had unrealistic expectations of what it would be like. I’ve never purchased a home before, but I know my boyfriend has experienced a lot of remorse since purchasing his first car. He had to sink a lot of money into repairs the first year and a half he owned it, and at this point he can’t wait to get something reliable.
    E.M. recently posted…April Goals & Review of MarchMy Profile

    • Wow, my friend is just going through some car issues now. She probably will have to replace 2 cars at once. I’m trying to help her with getting a more reliable car. I don’t know what is worse having home problems or having car problems.

  4. Obviously,the ideal is to think through all these things before buying, but once they’ve already bought, then all those regrets just become a sunk cost.

    And the only thing worse than making a mistake is prolonging a mistake.

    Good for them for noticing so soon and not getting bogged down by emotions that force them to stay in something they can’t afford.
    Mario Adventuresinfrugal recently posted…Laying down some frugal goals for April 2014My Profile

    • I agree, I think it’s best for them to get out of it and move on since they now know homeownership is not for them. Why prolong it.

    • Oh, I know cars are usually on the list of buyers remorse. It happens to the best of us, but nothing much to do but move forward and learn from this lesson.

    • Yeah, that is a big lesson there. Have to really watch out for those flood zones.

  5. Yes, I am completely aware of the home-buying experience, and frankly it is hard to deal with. I think this post pretty much sums it up.
    I am still curious, how did the couple pay off the loans for the house in just one year?
    David recently posted…Is Global Warming truly happening?My Profile

    • They haven’t paid off the loan. They’ll have to find a buyer that is willing to pay more than what they paid a year ago in order to cover what they still owe the bank and the realtor sales commission. If they are lucky they will walk away even without having to bring any additional money to the table.

  6. Oh I definitely have thought about this with our home. After experiencing a basement flooding during a huge storm (biggest one I’ve personally experienced) plus a collapsed sewer drain out (thankfully the city was liable in our situation!) I definitely have questioned whether it’s worth it. We did take on a house with a ton of projects, so we knew what we were getting into, but it really does suck up a ton of time, energy, and money.
    DC @ Young Adult Money recently posted…3 Reasons You Should Finance a Car Instead of Pay CashMy Profile

    • I know I felt the same way. I definitely think the first year is the hardest when it comes to homeownership. It’s a big adjustment and many times I started to doubt my decision. It has gotten better for me though now that I’m on my second year.

    • I think the flood zone issue is one to keep in mind because that is something you cannot change.

  7. I can’t help but feel sorry for the couple. Imagine that. It’s life their dream home turned out to be a nightmare, expenses-wise. I don’t own a home yet but I already have a list of important things that I need to make sure I check first if ever the time will come that I am able to afford one. It can happen only once so I want to make sure it will be not only good but a best buy.
    Jen @Sprout Wealth recently posted…How to Use Game of Thrones to Sprout WealthMy Profile

    • Well, a fixer upper will always cost you money to fix up to your liking. Perhaps they underestimated the amount of work, I’m not sure. It is something to keep in mind though. You need lots of patience when you buy and older home that needs repairs.

    • It’s good that you were able to hold on for 7 years. I read that you should plan to own for at least 5 years before you start thinking of selling to cover realtor commission and other expenses of selling.

  8. I hope they’re not taking a huge financial hit from having to sell after only one year…but unfortunately, it’s probably unavoidable. It doesn’t seem like they were ready to buy a house and didn’t think about the possible issues that may arise. I’ve been looking and thinking about buying a place for a while but have continued renting. It’s a big commitment to buy a place and I want to make sure it’s the right decision.
    Andrew@LivingRichCheaply recently posted…Is it REALLY Okay to Take Paternity Leave?My Profile

    • It’s best to take your time when it comes to buying a home. You will thank yourself later when you’ve made the right choice.

    • That’s great. It’s all about figuring out what you like to do in terms of DIY. If you are not willing to do anything or don’t enjoy it then you have to be ready to pay a professional. It can get expensive.

  9. I’ve never had remorse over a home purchase but certainly after buying a car. One winter was really bad and I bought a 4WD small SUV because I was tired of sliding around in my car. It was great for a month, then the increased gas costs were just stupid. We kept that vehicle about a year and sold it for a bit of a loss. You should never buy something like that on impulse, no matter how snowy it was. I could have probably rented a vehicle to get through the worst of the weather with much less headache.

    • I’ve considered buying an SUV especially after the harsh winter we had. But like you said I don’t think it’s worth the gas expense for 3 months of winter weather.

    • I think many people get caught up with the dream of homeownership and forget about the financials. It is unfortunate that they realized it after they had sealed the deal.

  10. My sister bought a house with NOTHING down at the height of the bubble burst. She’s managed to hold onto it magically, but she’s also been the type to work a 2nd waitressing job so she got by. After refinancing recently with a low interest rate, she’s got a more affordable loan payment but she’s still got a ways to go to pay it off. What helps her out is that her home is a cute, 2 bed 2 bath with a fully finished basement near an all-female college so she could find some decent tenants if she decides to move away. But she’s lost a lot of money with her house too and I know she wasn’t prepared for all of the work and money!
    Tara @ Streets Ahead Living recently posted…I’ve been everywhere man–how to see North America on the Cheap:My Profile

    • I’m sorry to hear about your sister’s situation. At least she was able to get that low interest rate so that will help a lot. I have a 2 bed 2 bath also. It does make it much more affordable to have a small home.

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