I Made the Classic Buyer Mistake

When buying an on-market property, there’s one common mistake buyers often make—I know because I’ve made it myself.

Many years ago, before my days as a Buyer’s Agent, my husband and I tried to buy a charming terrace house in Darlington. It was liveable but needed some work. The kitchen, having been tenanted for years, was average.

From the start, we knew we’d need to spend around $30,000 in the first six months to make it comfortable. Based on comparable sales, we estimated its value at approximately $1,100,000. (Hard to believe that once got you a three-bedroom terrace in Darlington!)

And this is where we made the same mistake so many buyers do.

We used a simple, yet flawed, calculation:

“It’s worth X, we need/want to spend Y, so it’s really worth X - Y.”

In other words, if the property was worth $1,100,000 but required $30,000 in renovations, we valued it at $1,070,000.

So, we submitted an offer of $1,070,000.

No deal.

The Mistake: Your Budget Doesn’t Define Market Value

The property wasn’t worth less just because we needed to spend money on it. Its $1,100,000 price tag already reflected its average condition. Had it been better presented—with an updated kitchen, for example—it likely would have been worth at least $1,150,000.

We were emotionally invested and double-dipping—factoring in the property’s condition and then deducting the cost of work, even though the price already accounted for it.

We learned this lesson the hard way when another buyer snapped it up for $1,130,000. And when it inevitably hits the market again, I’ll surely regret not securing it when I had the chance.

This is why expert research and an objective understanding of market value are critical if you want to go from house hunter to homeowner.

Thanks for the great feedback on last week’s attic renovation story! If you missed it, I’ve left the link below.

https://www.purchasewithpenny.com.au/purchasing-advice/attic-renovation