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Tips for buyers
When you're first starting to look to buy, you'll quickly pick up on a few trends happening in the local market. For example, you might notice an over abundance of properties available for sale (indicating a buyer's market), or on the flip side, you might not find very much available (indicating a seller's market).
Either way the market may be heading, there are always a couple of extra tips you'll want to note when looking at homes.
- Never make negative comments about the house during the showing. It's becoming more and more of a popular practice for sellers to have recorded video of their home during showings. If you truly like the house, except a few minor fixes, and voice that for the sellers to hear, that could potentially diminish your negotiating power later.
- Never talk to the sellers or their agent. Again, talking directly with the seller or their agent could diminish your negotiating power. Always be sure to run all communications and questions through your agent first.
- Plan ample time for scheduling showings. Nobody likes to run late. But it's especially inconsiderate of the seller's time when you insist on seeing 20 houses in a four hour period. Not to mention you really don't do yourself any favors trying to rush through every showing just to stay on schedule. Always block out a chunk of reasonable time when viewing houses. You'll get a much better look and feel of the houses when you aren't feeling rushed.
- Narrow down wants and needs first. Especially if you're planning to buy and live with another person. What may be on your top three list, may or may not necessarily be the same for your counterpart. Discuss all options with everyone in the household before looking. Also take the time to realize what is realistic and what is not on your wants and needs lists. Most guys would kill for a huge man cave, but it doesn't always necessarily happen if you're looking in the entry-level price range. Be prepared to compromise on a few things, and keep the overall goal in sight.
- Tell your agent and lender everything. Really, seriously, like EVERYTHING. If it's financial-related, it's likely your lender will find out eventually anyways. And if it's transaction related, your agent will find out eventually also. Sometimes, buying a house is a bit like adopting another family member or two for the period when you're searching for that perfect house, and then, eventually, getting an accepted offer and proceeding to closing. Your lender and your agent will seriously be your lifelines during the home buying process. Put them on speed dial.
- Do your research. When you really start to get serious about buying, you should know which areas or neighborhoods seem amenable to you. It's also a good idea to check out school performance reports in those neighborhoods (even if you don't have kids, living in a good school district will help your resell value later on). Make sure your favorite grocery store is nearby. Find out where your bank is. These are a lot of minor details buyers can often forget when they find a house they just absolutely LOVE. The house may be great, but maybe it's 10 miles from the ATM, and that is something you'll want to consider on your list of haves and wants.
- Remember, this is a business transaction. As emotional of a process buying a home can be, it's important to always look at it with an objective perspective. Often times buyers get so emotionally attached to a prospective home (we've all been there -- you've taken one look at a house and already start planning the furniture layouts and decor in our minds...) that they want it SO BAD that they will end up doing ANYTHING to get the house, and end up with a bout of buyer's remorse. If you keep a level head through the negotiations, you'll end up making a sound decision in the end.
- Be prepared to waive contingencies. If you happen to put an offer in on a house that has received multiple offers, be ready to consider certain contingencies that you may have to wave. This is a great tactic for giving your offer an edge over others (for example, putting more money down in the earnest money deposit). You could even consider writing a personal letter to the seller, emphasizing your intent for purchasing the house and taking good care of it. However, be wary with some of these contingencies. Remember, this is a business transaction. If you're looking to purchase an older home, it is probably not a good idea to waive your inspection just to strengthen your offer. On older homes, inspections can sometimes be crucial. Purchasing an older home without knowing of any structural or safety hazards, again, could lead to buyer remorse.
- Submit all paperwork on time. If you're planning to get a loan to purchase a house, be prepared to submit multiple financial statements frequently to your lender. This can become very cumbersome, especially if you have a lot of complicated finances. But try your best to get this turned in as soon as your lender requests them. Lenders and underwriters have many deadlines and due diligence to complete before giving you the "clear to close", and delaying your paperwork puts everything behind schedule. It's a great peace of mind to go into your closing knowing that you got your "clear to close" from the lender several days beforehand.