What do homeowners regret most about their purchase? And tips for avoiding them

Have you purchased a home in the recent, or not so recent, past? If you find yourself having some regrets about purchasing the place you now call home, you're not alone.

Nearly half, or 47%, of current homeowners across the country say they have a regret related to their home purchase, according to new data from Bankrate's recent Homeowner Regrets Survey released this week.

"Some of these issues are, in a sense, timeless because they persist over time, and I think some are exacerbated by where we are with the economy at the moment. The overriding concerns among Americans — which, of course, is the direct result of inflation — is affordability, or the lack of affordability," said Bankrate Senior Economic Analyst Mark Hamrick. "For those people who are already in homes, with the vast majority of those having low mortgage rates, the ongoing costs associated with homeownership take front and center."

Move Right In: Looking for a small town still close to NYC? Little Falls might be the place for you

What do homeowners regret the most about their home purchase?

The biggest regret among homeowners (40%), according to the survey, is underestimating how expensive maintenance and other hidden costs associated with owning a home are. Other regrets homeowners have about their home purchases include the size of their house, with 18% saying they bought too small of a property and 10% saying they bought too big of a property. Fifteen percent of homeowners said they purchased a home in a bad location.

In terms of finances, 14% of homeowners regret paying too much for their home. And, 13% of homeowners say their mortgage payment is too high, while 10% say they didn't get the best mortgage rate when purchasing their home.

Homeowners would buy their home again despite regrets

If they had to do it all over again, though, 69% of homeowners said they would still buy their current home despite any regrets they have over their purchase.

Hamrick said this is the case because, despite the current state of our real estate market, achieving homeownership is still a big goal for many. He said that it provides a sense of predictability, stability, privacy and other benefits that people might not necessarily be able to achieve if they're renting or living at home with family.

"Owning a home, and the physical financial security that comes with it, has historically been considered a part of the American Dream," the report reads. "That still seems to be the case, as 78% of U.S. adults say they consider owning a home to be part of the American Dream, according to our Home Affordability Survey. It's the most popular option suggested by Bankrate — more than being able to retire (65%) or having a successful career (65%), among other options."

How can new homebuyers avoid having regrets?

Hamrick said the best thing for potential buyers to do in order to avoid similar regrets, especially the ones related to finances, is to stop living beyond their means, determine how much they can actually afford to spend and to prioritize saving as much as possible.

"Don't overdo it when it comes to stretching on that mortgage payment, as well as something that can have a certain amount of upside risk, which is the cost of home insurance and property taxes," he said. "You might have some uncertainty with a fixed-rate mortgage payment, but what you don't have certainty on is the cost of insurance and property taxes, which, in most instances, are going to be adjusted upward over time."

When it comes to what you spend versus what you save, Hamrick also stressed the importance of properly budgeting. He said Americans commonly under save, and that most Americans live paycheck to paycheck, which becomes an issue when the unexpected costs associated with homeownership hit.

Hamrick recommends that potential homebuyers prioritize saving money wherever possible, and to consider using saving methods that will make the process easier. This includes things like high yield savings accounts, a certificate of deposit or a money market account, all of which provide interest rates that are higher than typical savings accounts.

"It's imperative that people save and it's imperative that homeowners save, because as homeowners move over the threshold of homeownership, the clock starts ticking on when you're going to basically need or going to be required to spend more money," he said. "As we've established in the survey and everybody who has owned a home for some period of time will attest that these things come at you. So, you don't want to go into debt in these situations because that's only going to further exacerbate the affordability issue."

Maddie McGay is the real estate reporter for NorthJersey.com and The Record, covering all things worth celebrating about living in North Jersey. Find her on Instagram @maddiemcgay, on X @maddiemcgayy, and sign up for her North Jersey Living newsletter. Do you have a tip, trend or terrific house she should know about? Email her at MMcGay@gannett.com.

This article originally appeared on NorthJersey.com: Here's what homeowners regret about their purchase