Start with the Web
Any time you are in the market searching for a home, you will find homes for sale posted on-line. This is a good place to start. It allows you to look at many homes in a relatively short period of time. Homes with only photos of the exterior deserve a “Maybe”. It could be that the realtor is planning on posting professional [interior] photos soon.
As you look through photos of “Favorites”, keep in mind that the realtor is looking to make a good impression. They are hired to sell the home. They know to take a photo from the angle making the home look it’s best. There is no substitute for walking through the actual home, not even a VR simulation. Rooms that seemed small in a photo, may really be bigger. Photos showing what is adjacent to the home may not have made it onto the web. Views, noise, smells can not be properly assessed on-line.
Use Your Realtor
If you haven’t already found a Realtor, interview a few. Work with the one who seems to really care about your needs, not their time or the phone when it rings. Then ask this Realtor to show you homes you are most interested in. This will give you a chance to see the interior and give your realtor a chance to see what you are looking for. The realtor then uses this knowledge to suggest other homes that might work of you. This makes searching for a home less stressful and more pleasant.
Your realtor can remind you of criteria you are overlooking or forgetting when you think you’ve found the home. They can point out things that are lacking or too small/too big. In other words, they can act as a counterbalance or at least a second set of eyes.
Probably the toughest part of the process, the offer is when you should consider things carefully. First, you should have been looking at homes below your budget cap. If your lender pre-qualified you for a home up to $475,000 for example, you need to be looking at cheaper homes to leave some room for negotiating. As I write this article, the market remains tight (there are not many homes for sale) and buyers are returning to the market. So you will be bidding on homes where there are other interested buyers.
You may find that you need to offer more than the asking price, or are getting a home that needs some work or some combination of the two. Keep in mind that offering $10,000 above the asking price will add about $70/month to your payment. This is for for a $450,000 home with 3.5% down if your loan is at 5% interest. Is it really worth losing out on the home you want because of an extra $70/month?
The other thing to consider here is that ultimately, the home has to appraise for the amount you offered. If it does not, you will not be able to get the loan you need to close escrow.
When a home does not appraise at or above the agreed upon price, there are 3 possible outcomes:
– the buyer backs out and the home returns to being For Sale. This leaves the seller possibly facing the same situation when dealing with other buyers searching for a home.
– the seller agrees to reduce the price to the appraised value. An unhappy situation for the seller that can lead to refusal to make repairs if the home inspection finds items needing work.
– the buyer comes up with the difference in cash to arrive at the offered price.
It is in these moments that the value of your lender and your realtor shines through. If you need an experienced professional in your corner, contact me at 760 622 5087 or firstname.lastname@example.org. I will be with you every step of the way, from getting the loan to getting the keys.