Burning out from exhaustion or wasting too much time due to lack of knowledge or unrealistic expectations is one of the worst things that can happen to buyers.
How much is your time worth?
How much is your time worth? That’s a key question buyer’s need to think about when looking for a property. House hunting for the majority of buyers can take months, sometimes even years before they make a purchase. Owner occupiers in particular can take a long time.
According to a survey released by UBank in August 2015, 36% of South Australian residence spent more than six months searching for a house. 9% spend more than 2 years. 14% of Victorian’s spend anywhere between 7-12 months hunting for a property. 33% of Queenslanders can spend up to 6 months. The national average is 6.5 months to find and buy a home.
The most striking revelation is that buyers spend 12.4 days just travelling to view homes. That’s 300 hours in transit.
Six and a half months might not seem too bad; you are buying a house after all and it will take a bit of time. It’s not until you break down the process that you realise how much work it takes to find a house.
There’s the searching process. Scouring dozens, if not hundreds of properties listed online for 15, 20, 30 minutes, or even an hour at a time all adds up.
It’s not just researching the house, either. Committed buyers will also spend time investigating the area and proximity to amenities as well as recent sales of similar properties to gauge the current market interest. Speaking to selling agents will also clock up the hours.
Then comes the open for inspections, which usually run for half an hour. Smart buyers would use every second of the open to thoroughly inspect the property, thinking carefully about how well it meets their needs, and if there are any potential maintenance issues.
Hopefully the property does meet all of your criteria. If it does, congratulations. You’ve reached the final stage: taking it off the market!
How this happens will depend on the type of campaign the property is being sold through. It might be going to auction or you might need to submit an offer directly to the agent.
Hopefully, all the hard work pays off and you secure the property. But you may not. And then you have to start all over again.
So how much time have you spent searching and inspecting to find that one property? Say you spend an hour, up to 90 minutes or so a day searching through listings, as well as investigating the area and recent sales. That doesn’t have to be in one chunk, but 15 minutes here and there at work, or over lunch, and then at home can all quickly add up. That can accumulate to 7 to 10 hours a week, just for searching. Throw in a couple of house inspections and that adds an extra hour.
At a conservative estimation, an hours searching and investigating per day plus two open for inspections is eight hours a week. A whole extra full day’s work. Now for the maths.
Using the average time of 6.5 months (28 weeks) to find a house, buyers can spend up to 224 hours searching. Plus, another 300 hours spent travelling and you’re up to 524 hours. That’s roughly 13, 40 hour weeks. It’s a second job. In dollar terms it’s a quarter of a year’s wages, almost $15,000 on the average salary.
So how can it take so long?
The biggest mistake buyers can make when buying a property is not matching their budget to either the best property or the position, depending on their criteria. Buyers can consistently lose out on property if they are pursuing either the wrong area or the wrong property for their budget, and not compromising on one of those factors. You could be looking for a particular property, but may not be able to find something in your first choice of suburb. Or you may want to live in a particular area, but have to rethink the type of property you can secure.
The best thing buyers can do to safe guard their time is to conduct as much research as possible. Have a clear goal in mind, know your budget, and understand the market you want to buy in. Understanding your parameters from the beginning of the search will ensure you target the most realistic opportunities and ensure your search doesn’t drag on. Speak to experts, conduct research, and know what you want to achieve.
Burning out from exhaustion or wasting too much time due to lack of knowledge or unrealistic expectations is one of the worst things that can happen to buyers. Doing the ground work early will prevent this from happening and aid in a better, and quicker, purchase.
Time is worth far more than dollars. Money comes and goes, but you can never turn back the clock.
The information in this article is of a general nature only and does not consider your personal objectives, financial situation or particular needs.
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