Guest Post by Dan Lucchesi
Total Realty Advisors
1. Location is still one of the most important factors to consider in your buying decision.
The importance of location can mean a lot of things to different people. For example, a lot of buyers want to purchase in an “Up and Coming” area so they can see the maximum appreciation of their purchase. However, that usually means having a keen eye for key fundamentals and being willing to move in ahead of the curve. If everyone knows the area is the popular place to buy, it may be too late already. A good Agent with their fingers on the pulse of the market can help with this.
On the other hand, location may mean things like safety and schools to other buyers. Buyers can do a lot of research online to find the school districts that are performing well or areas with low crime statistics. There are a wealth of resources including citydata.com, police departments, state school performance, etc.
Location can even be micro in scale. For example, in most cases, a home on a busy thoroughfare will not appreciate as much as a comparable home a couple blocks further into the same neighborhood. The same is true for homes with neighboring uses that are less than ideal to most buyers. The important thing I always recommend is to think about the location, do your research and choose based on what works for you.
2. Not all Agents are created equal.
Real Estate Brokers (Agents, Realtors, etc.) may have vastly different degrees of education and experience. Some may have the minimum four week coursework and others may have a Bachelor’s or even Master’s degree in the field. Some Agents work very hard for their client’s best interests and offer a lot of personal attention. An Agent with a huge book of business, may not be able to offer the same service and attention as another. Are you fast paced or easy going, tech savvy or pen and paper, many showings or just the right ones, personal service or results, do you want to know the what-ifs or want things to seem seamless? Choose to work with an Agent whose expectations, work style, values and personality fit with yours – otherwise you may feel like you’re not getting the service you expect and deserve.
3. Not all Lenders (or Mortgage Brokers) are created equal.
Lenders play such an important role in getting the transaction from “Under Contract” to “Closed.” Any Agent who’s been in the business a while can tell you that your Lender can be a hero or can completely derail your transaction. They’ve all experienced a Lender who is overloaded or isn’t paying attention to the deal and fails to get final underwriting approval in time to meet the closing deadline. On the other hand, they’ve also worked with those Lenders who are responsive, attentive, who are ahead of schedule and always find a way to Under Promise and Over Deliver. Ask your agent for a referral to a Lender who they can highly recommend based on their personal experience.
4. Cash is King and financing matters.
Your financing is one of the most important components of your offer that the Seller and their Broker are considering when evaluating the merits each offer. For most sellers the old adage is true, Cash is King. It conveys the highest degree of a serious, qualified buyer – it also implies fewer contingencies and possible objects during the transaction.
5. Get an Inspection!
With few exceptions a Buyer should always obtain an inspection. I have too many stories of Buyers seeing great cosmetics of a home and concluding that the place was well cared for and “must be fine” only to learn of the $3,000, $7,000 or $15,000 repair that they just inherited. It will be the best $400 you spend. Ask you Agent for a recommendation on a good Home Inspector, they’ve likely worked with many. Do I need to mention that not all Home Inspectors are created equal?
6. Make your offer stand out.
Making your offer stand out is especially important in a Seller’s market. Keep in mind that your offer price isn’t the only thing that makes up a strong offer. There are some simple tips you can try to make your offer more appealing. Shorten your closing deadline, offer to pay for certain seller closing expenses, increase your down payment, consider an escalation clause (to beat the highest competing offer), pay cash if you can, offer to pay the difference if the house appraises for less than the purchase price, increase your earnest money and if the market is really hot, you might even consider waiving some of your objections rights (loan, inspection, appraisal, etc.). But tread carefully as you don’t want to win the deal with some aggressive tactics only to have one or more of those objection rights you waive come back to bite you.
7. Act prudently and adhere to the dates & deadlines of the contract.
This may seem obvious. But you’d be surprised how many times I’ve had Buyers miss getting their Earnest Money in to the title company by the deadline. Or how often a Buyer takes their sweet time to sign the Seller’s disclosures once it’s under contract. Or isn’t’ responsive to their Lender, when they request information. The more times you force your Agent into asking the Seller or their Agent for forgiveness and accommodation, the less likely they will be to cut you that slack when it really counts. This is especially true in strong Seller’s market, when they may have one, two or even three back-up offers waiting to take your place. Be diligent and jump on it when your Agent tells you to act.
8. Make sure to accurately represent your financial situation to your Agent.
Keep in mind that part of their job is to help you buy a home you can afford. That means the monthly payment and the cash needed to close. If you misrepresent this information to your Agent or your Lender, it will eventually come to light. And more than likely, you’ve exhausted a lot of peoples’ time in the process, especially your own!
These considerations are general. Please seek the appropriate tax and/or legal counsel for your unique situation.
Dan Lucchesi, MSRECM
Independent Broker, Total Realty Advisors
303.999.1586 – [email protected]