HOMEBUYERS: How to Save Thousands When You Buy
?When you analyze those successful home buyers who have
the experience to purchase the home they want for thousands of dollars below a
seller?s asking price, some common denominators emerge.?
If you?re like most home buyers, you have two primary
considerations in mind when you start looking for a home. First, you want to
find a home that perfectly meets your needs and desires, and secondly, you want
to purchase this home for the lowest possible price.
When you analyze those successful homebuyers who have been able
to purchase the home they want for thousands of dollars below a seller?s
asking price, some common denominators emerge. Although your agents negotiating
skills are important, there are three additional key factors that must come into
play long before you ever submit an offer.
These Steps Will Help You Save Thousands When You Buy a Home
Make sure you know what you want . . . As simple as this
sounds, many homebuyers don't have a firm idea in their heads before they go
out searching for a home. In fact, when you go shopping for a place to live,
there are actually two homes competing for your attention: the
one that meets your needs, and the one that fulfills your desires. Obviously,
your goal is to find one home that does both. But in
the real world, this situation doesn't always occur.
When you're looking at homes, you'll find that you fall in love
with one or another home for entirely different reasons. Is it better to buy the
4- bedroom home with room for your family to grow, or the one with the big
eat-in kitchen that romances you with thoughts of big weekend family brunches?
What's more important: a big backyard, or proximity to your child's school? Far
too often people buy a home for the wrong reasons, and then regret their
decision when the home doesn't meet their needs.
Don't shop with stars in your eyes: satisfy your needs
first. If you're lucky, you'll find a home that does this and also fulfills
your desires. The important thing is to understand the difference before you get
caught up in the excitement of looking.
Find out if your agent offers a ?Buyer Profile System? or
?House-hunting Service,? which takes the guesswork out of finding just
the right home that matches your needs. This type of program will cross-match
your criteria with ALL available homes on the market and supply you with printed
information on an ongoing basis. A program like this helps homeowners take off
their rose-colored glasses and, affordably, move into the home of their dreams.
To help you develop your home buying strategy, use this form:
What do I absolutely NEED in my next home:
What would I absolutely LOVE in my next home:
How Sellers Set Their Asking Price
For you to understand how much to offer for a home you?re
interested in, it?s important for you to know how sellers price their homes.
Here are 4 common strategies you?ll start to recognize when you begin to view
1. Clearly Overpriced:
Every seller wants to realize the most amount of money they can
for their home, and real estate agents know this. If more than one agent is
competing for your listing, an easy way to win the battle is to overinflate the
value of your home. This is done far too often, with many homes that are priced
10- 20% over their true market value.
This is not in your best interest, because in most cases the
market won't be fooled. As a result, your home could languish on the market for
months, leaving you with a couple of important drawbacks:
your home is likely to be labeled as a "troubled"
house by other agents, leading to a lower than fair market price when an
offer is finally made
you have been greatly inconvenienced with having to
constantly have your home in "showing" condition . . . for
nothing. These homes often expire off the market, forcing you to go through
the listing process all over again.
2. Somewhat Overpriced:
About 3/4 of the homes on the market are 5-10% overpriced. These
homes will also sit on the market longer than they should. There is usually one
of two factors at play here: either you believe in your heart that your home is
really worth this much despite what the market has indicated (after all, there's
a lot of emotion caught up in this issue), OR you've left some room for
negotiating. Either way, this strategy will cost you both in terms of time on
the market and ultimate price received
3. Priced Correctly at Market Value
Some sellers understand that real estate is part of the
capitalistic system of supply and demand and will carefully and realistically
price their homes based on a thorough analysis of other homes on the market.
These competitively priced homes usually sell within a reasonable time-frame and
very close to the asking price.
4. Priced Below the Fair Market Value
Some sellers are motivated by a quick sale. These homes attract
multiple offers and sell fast - usually in a few days - at, or above, the asking
price. Be cautious that the agent suggesting this method is doing so with your best interest in mind.