Research
Sellers can put a lot of pressure on buyers because they are eager to make the sale. Remember, buying a home is a serious investment. Buyers need to understand all the factors underlying the sale, including the area, timing, home inspections and hidden costs. Let’s look at a few areas in which a buyer needs to be prepared to make an offer on a home.
State of the Home
Even if you work closely with a realtor, the sellers are still the best source of information. They’ve lived on the property and in the community and should be open about their experience. Also inquire about the house, if they’ve completed any renovations, or if you’re ideas for home improvement make any sense.
The sellers may be trustworthy, but a home inspection is always a good idea. A complete analysis of the house’s condition will help you determine additional costs after making the offer. As for costs, also discuss taxes, insurance, utilities, and homeowner association dues if applicable so you can budget accordingly. These often add to mortgage loans and other expenses related to owning a home.
State of the Neighborhood
What’s the state of the neighborhood in which the house is located and how can that relate to making an offer? Quite a lot actually. If a scandalous crime occurs in a generally safe area during the time of home purchase negotiation, that buyer can use that to his advantage by dropping the asking price due to concerns about neighborhood safety.
Before buying a home, make sure you know the ins and outs of the neighborhood. Browse the web for community websites, local newspapers, and blogs. Dig around for local news and local crimes. You can look online at CrimeReports™ or check with local police stations for crime statistics. There are also Internet resources on school districts; a good educational infrastructure will benefit even if you don't have kids. Home values are typically higher in such areas.
Buyers should also check on:
- Amenities: Check on the types of activities within walking distance. You can do this by checking local listings or even Google Maps. Community activities are usually listed with homeowners associations, so having this info can also prepare you for making a home offer.
- Traffic: The level of activity in the immediate vicinity can impact your quality of life at home. Traffic patterns play a huge role in the local noise level. Visit during rush hour and other parts of the day to assess the traffic flow at different times. Use this information in the home buying negotiation. You can then ensure the property is reasonable within your lifestyle needs
Mortgage Pre-approval
An often overlooked step, especially for first-time buyers, is obtaining a pre-approved mortgage. This shows the seller you are fully vested in the process, and saves time when you eventually file a mortgage application. Pre-approval also defines your price range and gives the seller confidence the deal won’t fall through at the last minute. All it takes is a little time with a potential lender to look into your financial details.
Negotiation is one of the most important aspects of making a home buying offer. Without it, you could end up paying a lot more. Professional real estate agents are skilled negotiators. They charge a fee, but it’s worth it considering the risks of overpaying for your financial well-being. It may seem easy to contact sellers and look for deals online. Even if you have made offers in the past, buyer’s agents are up on the latest requirements and work in your favor at the most crucial stage.
Pricing
When you discuss homes with sellers, be careful about your approach. Pointing out everything that’s wrong could turn them off to your potential offer. Sellers tend to be sentimental about the home; it helps if you respect their sentiment. Naturally, you want to pay less, they want to be paid more – trying to drive down the cost by picking out every flaw is usually counterproductive.
Determining if a particular home’s price is reasonable can be challenging. Two different homes of the same size in the same area don’t always cost the same. A buyer agent is familiar with all the details which go into pricing a home – another reason to have professional assistance in the process. You can also browse Internet listings. Remodeling and more scenic views drive prices up. The more research and home visits you make, the easier it becomes to assess worth versus features.
Once you determine a price, stick with it. Persistent bidding may not work in your favor. Making an offer on a home requires much research and preparation. Follow the strategies and tips mentioned and getting that dream home at the best price is a realistic goal.