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Real Estate Buying Tips…

Thinking of buying your own home?

How to Negotiate with Sellers:

Buying a home is one of the most important purchases most people will make. In order to make the right decisions the first time, potential buyers need to be prepared. Consider the following before starting negotiations:

Be prepared

Research the housing market in the target area. Once you have information about the general area, focus on the particular property and seller. Look for answers to questions such as:

Why is the homeowner selling? (If they’re moving because they find the area undesirable, you might as well.)

How long has the home been on the market? (If it has been on the market for a long time, perhaps there are negative facts about the property that you need to know.)

How much did the seller pay for the home compared to the current asking price? (If the seller paid more, find out why. Was it a general real estate trend, or did property values in that particular neighborhood go down?)

What is the seller’s time frame for selling and moving? Does it fit within your needs?

Are there any defects in the home or problems with the surrounding neighborhood? (For example, is the roof so old that it will likely leak during the next storm? Is there a new construction project in the area that will lead to major traffic congestion?)

As the potential buyer, you want the advantage. While you want answers to all your questions to the seller, reveal very little about your circumstances. Do not give the seller personal information such as your income, the maximum you’re able to pay for a down payment or the home, or when you want to move. Make sure that your agent knows not to reveal any such information to the seller or his/her agent.

Also, don’t let the seller see how much you want the property. If you appear desperate or overly enthusiastic, the seller then has the stronger bargaining position. When meeting with the seller or listing agent, keep your emotions in check.

Establish a Timeline

Find out if the seller needs to have the sale closed sooner rather than later. If the seller is feeling pressured to sell, use that to your advantage in negotiating. Even if you, the buyer, are the one with the deadline for purchasing a home, don’t let yourself be rushed into making concessions or a purchase you may regret later.

More Advice for First-Time Buyers

Pre-Qualification: Meet with a mortgage broker and find out how much you can afford to pay for a home.
Pre-Approval: While knowing how much you can afford is the first step, sellers will be much more receptive to potential buyers who have been pre-approved. You’ll also avoid being disappointed when going after homes that are out of your price range. With Pre-Approval, the buyer actually applies for a mortgage and receives a commitment in writing from a lender. This way, assuming the home you’re interested in is at or under the amount you are pre-qualified for, the seller knows immediately that you are a serious buyer for that property. Costs for pre-approval are generally nominal and lenders will usually permit you to pay them when you close your loan.
List of Needs & Wants: Make 2 lists. The first should include items you must have (i.e., the number of bedrooms you need for the size of your family, a one-story house if accessibility is a factor, etc.). The second list is your wishes, things you would like to have (pool, den, etc.) but that aren’t absolutely necessary. Realistically for first-time buyers, you probably won’t get everything on your wish list, but it will keep you on track for what you’re looking for.
Representation by a Professional: Consider hiring your own real estate agent, one who is working for you, the buyer, not the seller.
Focus & Organization: In a convenient location, keep handy the items that will assist you in maximizing your home search efforts. Such items may include:
One or more detailed maps with your areas of interest highlighted.
A file of the properties that your agent has shown to you, along with ads you’ve cut out from the newspaper.
Paper and pen, for taking notes as you search.
Instant or video camera to help refresh your memory on individual properties, especially if you’re attending a series of showings
Location: Look at a potential property as if you are the seller. Would a prospective buyer find it attractive based on school district, crime rate,
proximity to positive (shopping, parks, freeway access) and negative (abandoned properties, garbage dump, source of noise) features of the area?
Visualize the house empty & with your decor: Are the rooms laid out to fit your needs? Is there enough light?
Be Objective: Instead of thinking with your heart when you find a home, think with your head. Does this home really meet your needs? There are many houses on the market, so don’t make a hurried decision that you may regret later.
Be Thorough: A few extra dollars well spent now may save you big expenses in the long run.

Don’t forget such essentials as:

Include inspection & mortgage contingencies in your written offer.
Have the property inspected by a professional inspector.
Request a second walk-through to take place within 24 hours of closing.
You want to check to see that no changes have been made that weren’t agreed on (i.e., a nice chandelier that you assumed came with the sale having been replaced by a cheap ceiling light).
All the above may seem rather overwhelming. That’s why having a professional represent you and keep track of all the details for you is high recommended. Please email me or call me directly to discuss any of these matters in further detail.

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