Advice on Being a Successful Home Buyer
So what is a successful home buyer? That is easy—the person that finds the home of their dreams at a price they can afford. The next piece is trickier, how was the process? Were any lives lost during the home buying process?
The purchasing process is arduous whether you are a first time home buyer or a seasoned veteran. I have found that successful buyers follow a common set of steps. Here is my advice.
Tip #1- Get pre-qualified for a loan
This is obvious advice right. You can’t buy without money. It is critical to know what you can afford to buy before you start to search. Why get frustrated looking at homes you can’t afford? In Arizona you cannot submit an offer without a pre-qualification form….well an offer that will be considered. You need to provide proof of cash in a bank for a cash offer and proof of qualification for an offer with a loan. The seller will not select an offer without a pre-qualification form.
Clearly step one in the home buying process is find a good lender. If you don’t know one, ask your agent for some recommendations. Interview one or two and pick one. You want to stick to one lender thru the entire home buying process. There is too much stress involved in changing horses midstream. You want a lender you are comfortable with, one that answers your questions clearly, one that helps you understand the difference between what you qualify for and what you can reasonably make payments for.
The real estate purchase is processed by a team of experts. Pick your team wisely.
Tip #2– Decide upon your needs, wants and not haves
The next step in the home buying process is to look within yourself to determine what you really need. “You can’t always get what you want, you can’t always get what you want….but if you try sometime you find, you get what you need”….the Rolling Stones know what they are talking about. You need to know what you really need. And what you really can’t live with (this may be more important than the needs). What do you need to avoid. (Is that no pool or not in a certain part of town.) The easy part is determining what you would like in a house. That list is long. It is necessary to study that list and see what the priorities are. This will take some soul searching. Don’t worry if you don’t know now. Your agent will work with you. You will look at homes with different features and develop your requirements.
This is an important step. Without this step you can wander aimlessly looking at way too many homes. This will waste your time and the time of your team. Once this decision is made you can search in a systematic fashion. My advice is do not skip this step.
Tip #3- Be judicious
Once you have a list of must haves, like to haves and can’t live withs evaluate each house you view with flexibility. This step in the home buying process is analytical. Unless you have a custom house built you will never get everything you want in a house. You may hate the carpet or the paint color but that can be changed. If you need (or is it want) vaulted ceilings and a house has 8’-0” ceilings that cannot change. Look at the features with a practical eye. My advice is look for ‘good bones’. ‘Good bones’ is the location, the floor plan, the neighborhood. These things cannot be changed. You can always dress the house up. Some basic elements must exist in the house; other elements can be added or changed later.
Tip #4- Have realistic expectations
This step in the home buying process is education based. Expectations are developed from your peer group and your circle of influence. People/the internet may profess some ridiculous things to be true.
What you can get for a certain price is one of the biggest myths. You need to be realistic. The 3000 SF house in Scottsdale with granite countertops, custom tile floors and pool with a waterfall does not cost $100,000. It does not exist. You need to be realistic.
Bank owned property does not sell at pennies on the dollar. The market drives the price. The seller (whether it is a bank or individual) knows that. Be realistic.
Some things don’t exist or rarely exist. You won’t find a home built since 2010 in Gilbert with no HOA under $700,000. You probably won’t find a house built before 1950 with vaulted ceilings. Be realistic.
Discuss these things with your real estate agent or lender. There are state statistics you can review. Check your sources. You need to understand what is feasible.
You need to be realistic about the negotiation with the seller as well. Don’t expect the seller to fix every flaw in the house. Don’t expect to find a house that has no problems to report from the home inspector. Every house has something to report. Brand new houses have items to be addressed by the home inspector. It is their job to find things. Don’t nit-pick your seller. This could kill the deal. Be realistic.
My advice is talk to your real estate agent about expectations. Discuss the things you would like and listen. This will keep you grounded.
Tip #5- Understand the home buying process
I really believe that knowledge is power. The better you understand the home buying process the more you can have realistic expectations. With realistic expectations you will reduce your frustration level. A reduced frustration level reduces stress. Less stress makes a more enjoyable buying process. My advice is ask questions and pay attention. Trust the experts.
Read your purchase contract. You are entering into a legal contract. There are timelines that must be adhered to. Ask your real estate agent questions. It is their job to walk you through this process. Your real estate agent, your lender, your title company, the appraiser are all your team. They are working to complete this transaction. Ask them questions. This way you will not have surprises. Do not assume!
You need to understand your purchase contract, the escrow process, and the lending process. These three processes need to be completed to purchase a home.
Tip #6- Be responsible and be involved
There will be many things that your real estate agent will do for you to choreograph the home buying process. That said, you are still ultimately responsible for the purchase. My advice is be proactive.
There is a time period that is provided for you in the contract to investigate the property. This is your responsibility. Your agent will prod you to do this as thoroughly as possible within the allowed time frame. But it is you choice to do so. My advice is use the buyers guide and research the house and neighborhood. This is a big investment, do your homework.
The loan process can make or break a deal. Listen to your lender. Don’t quit your job or make a major purchase while the loan is in process. Actually don’t make any purchases without checking with your lender. This can disqualify you for your loan. I have seen it happen.
Tip #7- Have fun!
My biggest piece of advice is–have fun. Buying a house is an important decision, but it should also be fun. You want a home in which you will raise your family, share your life with someone, and maybe even retire.
I want to be a part of this momentous event. Along with the DPR team I have the knowledge and experience to guide you through the process and have some fun. Let’s start searching! Please contact me with any questions or concerns. You can call me at 480 721-1195. If you want to start looking at properties on line use my website.