Use An Experienced Realtor
As a home buyer there is no cost to use a realtor. It’s amazing to me when people choose not to use a realtor. It is like going to court and being represented by the opposing counsel. You need someone in your corner who knows the area, is up to date on the market, and maybe most importantly, who will negotiate with integrity to achieve those goals which are so important to you when buying your Phoenix area home.
Get Qualified Before You Look At Your First Home
This is very important for two reasons: you need to know how much home you will be able to afford and if you find that perfect home, you’ll need to provide proof that you are able to buy the home before the seller will even consider seeing an offer. It is very common that people go out to look at homes before they know what they can afford. When people do this, it can really destroy their buying experience. I have had many clients looking at their dream homes and then finding out that they are well out of their budget. Sometimes is as simple as paying down a small credit card to jump their credit score into a lower percentage rate to qualify and sometimes it’s a bit more reality then a buyer is expecting. By putting the cart before the horse, an unqualified buyer may feel disenchanted by their options, having hoped for features that are more suited for the ten year plan instead of the close-in-3-days plan. They go to the closing table feeling they have settled rather than being happy with their purchase.
This is a happy time in your life, let’s do it right so you can enjoy your home buying experience.
Look At Your Budget After You Get Qualified
When we have clients that are stretching to get into a home, we will often do a quick monthly breakdown of their expenses. We often find that even though on paper they qualify for a mortgage payment, it often leaves very little money at the end of the month to enjoy life. A home should be a joy not a burden. Leave enough space in the budget to enjoy a movie or a vacation, not just your home. Consider “living” that mortgage payment for six months by placing the additional total monthly payment into a savings account. If you can swing it and it doesn’t sting, then there is your moving expenses or a few new furniture pieces! Most importantly, you’ll be sure that you’re making a wise choice.
Take a quick peek at what your mortgage may be with our mortgage calculator on the sidebar behind that arrow to the top right of your screen. Don’t worry, you don’t have to fill out a form so we can stalk you later, we believe that when you are ready, that you will find us.
Location, Location, Location
Your new home choice has to take into account your day to day life. People often don’t count the cost of a long commute or less than desirable schools when looking at a beautiful home. Those buyers end up selling their homes after a short time once the beauty of the home is warn thin by an oppressive commute or challenges of a less than desirable school. It is very important that you share with your realtor what it is that makes you happy, what gives your life meaning so we can find the home to maximize that. If your realtor is not asking about you and your family, you need to tell them. If you are an avid outdoors fan, you may not feel happy in the middle of the city. If you love to walk to shops and restaurants then the suburbs may drive you crazy.
There is more due diligence you may want to consider that your Realtor can share to do some research on your own. They are numerous government websites that will give you information on demographics, crime, sex offenders, school qualify, flood prone areas and possible contaminants in the air or soil. Sometimes you can even get utility expenses reported from previous years to consider the energy costs of your new home. With the help of your realtor, you can do your homework and avoid a costly mistake.
Build A Rainy Day Fund
There are many hidden expenses that can pop up with home ownership and having some cash available can be very important. After the purchase of a new home, you often find yourself having to buy furniture, garden tools, window coverings and alike and this can add up if you spent your last dime on the purchase of a home. Buyers find themselves racking up high interest credit card debt when a little advanced planning would keep them much more financially healthy. Remember that “practice a mortgage payment” idea? Yup, now is the time to start.
Find The Home That Fits Your Needs, Not Your Dreams
One of the biggest mistakes made buy home buyers is getting too much home or over doing the options on a new home. There is almost never the perfect home, there will always be some compromises to be made. This is especially true when there is more than one decision maker. A good realtor can help you figure out what is truly important to you (or both of/all of you) and find ways to make it happen. Certain things can be done after close like tile, paint, pool and lighting. Other things are difficult or impractical to do like changing cabinets, adding a bathroom or moving walls. An experienced realtor can give you guidance on how to keep a dream home from becoming a nightmare.
Your Home Buying Strategy Depends On The Market
One very common mistakes made by realtors is not adjusting your buying strategy to the market. This can cause frustration or cost you thousands.
In a sellers market you have to be aggressive with your home search. When you find the home you like, make a good offer accompanied by a letter that gets them to see you as a person that will love their home as much as you do. Your realtor can be critical to whether your offer gets accepted. A poorly written contract or a less than professional communication can cost you the home. Your Realtor must sell the sellers realtor as well as the home seller. There is nothing worse than having to fight with a realtor throughout the transaction. Letting the other realtor know that you will work hard to keep the transaction positive and moving smoothly will get your offer a better look when there are many offers to consider.
When it’s a buyers market, you need to know how to negotiate to get the best price and terms. Many realtors think that a lowball offer is a great way to start a negotiation. Nothing could be further form the truth. If you start a negotiation with an offer that insults the seller, you creat an adversarial negotiation . Insulting the home they love will cost you thousands (if not losing the home all together) and if you do get the home, the escrow will be much tougher. Every repair will be a fight and if anything goes wrong, you may have a stand-off on your hands. If you are forced to make a low offer due to financial restrictions, a sincere note explaining the situation and asking for their help can get an offer accepted that would otherwise have been rejected.
In either market, you have to know the values in the area. Your Realtor should always do their homework to assure that you are not overpaying for you home.
When You Find A Home You Love, Make A Offer (Today)
In active markets, you don’t have the luxury of looking through every option available. By the time you look at all the options in a market, the one that you love will often be gone. Today’s technology allows you to look at many homes in your price range online and then cutting the list down to a reasonable number and then make an offer. Be decisive and make offers. Once you are under contract, you have an inspection period to do your due diligence and make sure this is the home for you. A common mistake is to do all the research up front only to find the home is no longer available.
Always Do A Home Inspection
This is a critical step to save you a lot of heart ache and expense. In my 17 years in real estate, I have seen some incredible things come up in inspection reports. I have seen undisclosed flood and fire damage, foundation setting problems, substandard home owner additions and repairs, and expensive roof issues. When the report shows that the home is too much, no matter how much you love the home, it may be time to move on. An experienced realtor can give you perspective on what is minor and what should be a deal breaker. With a new home, I often advise people to do an inspection just before the warranty expires.
There Are No Stupid Questions
The process of purchasing a home can be confusing and frustrating. What was true a few years ago is no longer true today. If you have a question or concern, voice them. The few dissatisfied customers I have had over the years have been largely to misunderstandings of the process. Read the contract and know what is expected of you and we’ll do more than what is expected of us.
What has your experience been with home buying? We’d love to hear and have an opportunity to address your experiences.