For most people, purchasing a house is one of the most significant financial undertakings they will ever encounter in their lifetime. There is a possibility of making numerous mistakes when purchasing that house and just like many other homebuyers, none of them wants to be ripped off. You may deal with experienced individuals in the real estate industry and some of them may try to exploit your ignorance.
Read on to find ways on how to become a knowledgeable homebuyer. The tips discussed herein will aid you in finding the home that suits your taste. They will also help you avoid the common risky encounters that may cost you a lot of money in the home-buying process.
Look at recently sold properties
Compare with similar properties that have been sold in the recent past. Check out the houses that are alike in characteristics, size and features. Also, look at similar properties in the neighbourhood with the same conditions. Compare the prices and see if it is more or less expensive than those properties. Ask your real estate agent for an updated and reliable data on comparable properties. You may also look for that information online and compare properties within the radius of the one you are interested in buying.
Compare other properties in the market
Visit other houses and check out their size, status and features. Compare these homes to the one you are considering buying. When you get a sense of how they compare in terms of amenities and condition, look at the pricing of both properties and see what appears to be fair pricing. It is advisable to market your property like other comparables in the market. Rational sellers are aware that they have to market their houses as the others in their category for them to gain a competitive advantage.
Compare unsold properties in the market
Some properties may have been overpriced, making them go unsold for a long time. That may be a reason for taking them off the market. Check if those houses were priced the same way as the one you are considering is currently priced. There may also be multiple similar properties on the market, which should make the prices reasonably low, especially if most of those houses do not have occupants. Look at the information online that regards the supply and demand of properties. It will give you an estimate of how long the properties are expected to be on the market, depending on their selling rates.
Get to know about market fluctuations and appreciation rates
See whether the prices have been fluctuating in the recent past. In a seller’s market, houses have a possibility of being overpriced and in a buyer’s market, the houses will most likely be under-priced. That depends on the supply and demand curve in the real estate sector. Look up information on interest rates of mortgages and job markets, which may impact the prices of properties. However, properties may sometimes be under-priced in a seller’s market and may also be overpriced in the buyer’s market.
Consult with your real estate agents
It is possible to buy a house without the intervention of a realtor but it is not advisable, especially for those who are new to the house-buying process. Real estate agents have the experience to evaluate a house and let you know if it is priced fairly. Sometimes, they do not have to examine the information about the property to know an estimate of its price. The realtor will tell you the right price for the property and guide you accordingly.
Negotiate on the prices by offering a bargain
Try making an offer lower than the quoted price to see how the seller will respond to the offer. A seller may quote the least price they are willing to take for them to avoid negotiations. Some sellers may also quote higher prices, expecting someone to negotiate and make a higher offer than the least amount they expect from the sale. You may also use a cash property buyer to get a great deal on your property. Using a professional and reliable house buying firms guarantees you a high cash offer.
Is the price reasonable and realistic?
Sometimes, we need the gut feeling of whether the price of a house seems fair to us. If you love that house and get a deal that makes you pay an amount over the market price, it will not matter later because you got what you wanted.
Request for an appraised value and an inspection
Valuating the house you are buying is important because it lets you compare the estimated price of the house with whatever you are offering to pay. It is useful to know whether you are paying more than the estimated value of the home. A home inspection is also helpful to approximate the price you are offering on the house. If there are expensive repairs on the property, you may ask the seller to lower the property price or make those repairs.
Check if it is a for-sale-by-owner property
Properties sold directly by the owners do not usually include the commission of a real estate agent. They should be cheaper compared to similar properties being sold by an agent. A possible issue with such properties is that the owner may not have set a reasonable price because they did not have guidance from a realtor. They may also decide to overprice the house because they were not satisfied with the selling price suggestions given to them by a realtor.
Pay attention to possible appreciations in future
Look out for potential growth in the neighbourhood of the house you are considering buying. Some developments are positive and have the prospects of raising the property prices in the area. There may be a huge company moving nearby, a school, better roads or mall being built. The closure of major amenities like malls and petrol stations may make the prices of the neighbourhood fall. You may use that to bargain and get a fair price on a home.