When you decide it’s time to buy your new home, your first step should be to choose a Realtor you’d like to work with. Ask friends and relatives for recommendations, and take some time to meet with the Realtor and get to know him or her before you sign on.
One important thing buyers should know about up front is the ability to have buyer agency, added Chris Howard, partner with Ogden & Company, Inc., AMO®. “Many people think agents can only work for the seller, but that’s not true,” she added. With a buyer agency contract, I’m legally obligated to negotiate the best possible price for the buyer.”
This is opposed to working for the seller, where the agent is obligated to to obtain the best price possible. “When I’m working for the seller, and the buyer asks me, ‘What do you think the house is worth?’ I can’t give them a price. With buyer agency, I can run a market analysis to determine what other homes in the area are worth. My duty is to get the buyer the lowest price.”
Once agency is decided, the Realtor goes through an estimate of how much you can afford, and perhaps more importantly, how much do you want to pay on a monthly basis. It’s also a good idea to go through pre-approval for a mortgage before you go looking because you’re a more attractive buyer when you have financing in place, he added.
Once a price range is decided, the Realtor should ask you some critical questions to get you thinking about the type of house and neighborhood you’d like. Questions to consider include:
- What’s an acceptable drive time to work?
- Do you prefer an urban or rural setting?
- How close do you need to be to schools, churches, shopping?
- What types of amenities do you want? Two car garage? Three bedrooms? Minimum maintenance?
Looking, Looking and More Looking
“The average buyer looks at 19 houses before they find the one they want to purchase, although everyone is different. A good Realtor should act as a mirror and reflect back to the buyers quickly what’s available.” Many buyers quickly learn that they need to prioritize what they must have from what they would like to have but could live without.
The Realtor should show you what’s available in the communities you’d like to live in, then set up properties you’re interested in for viewing the inside. “A good Realtor listens and takes good notes about the houses you look at. The Realtor should ask you what you liked and didn’t like about any particular house.”
The looking step can last anywhere from two days to several months, but the average is about 30 days. Once you’ve found the house you want, it’s time to make an offer.
Here again is where a professional Realtor can help guide you through the buying process. Once you decide you like the house, you need to ask yourself how much it’s worth to you to live there.
The agent can then help you draft an offer to purchase, where you can put down contingencies such as financing, home inspection, closing date, and acceptance date. The offer is signed and binding by both the buyer and seller.
The Home Stretch
“Over 95% of buyers are using professional inspectors, usually within 10 days of the accepted offer.” An inspector can help you determine the remaining life of the roof, water heater and furnace, as well as let you know what maintenance should be done and when.
“Inspectors really help buyers get a good handle on what they’re buying and allow them to budget accordingly.”
At this stage, between the accepted offer and closing, the Realtor should be following up with you to make sure the loan and title insurance gets completed. Then it’s on to the closing. That’s where your arm gets tired from signing so many papers.”
