It’s no secret that it can be confusing when buying or selling real estate. For most people, their experience with the real estate process comes from watching reality shows – and while we certainly love to watch them, they aren’t always a great representation of what the process actually looks like. In this article, we’re looking at some of the most common questions we get asked and running through the answers. This certainly isn’t an exhaustive list of questions – but they’re some of the ones we see most often.
Do I Need To Get Pre-Approved For A Mortgage Before Starting My Home Search?
The short answer here is…yes, please. While there is no legal requirement to get pre-approved before you begin your home search, doing so offers several advantages. For starters, it shows your buyer’s agent that you’re serious about your house hunt and not just nosing around Open Houses for something fun to do on the weekend. Second – and most importantly – if you’re ready to make an offer on a property, it shows the seller (and their agent) that you are ready, willing, and able to make that offer and stand behind it. When you put in an offer and provide your pre-approval letter, it gives a level of “tangible” proof that your offer is legitimate and can put you in a stronger position over other competing offers.
What’s The Difference Between A Buyer’s Agent And A Seller’s Agent?
Great question! You may know that the commissions to both the seller’s agent and the buyer’s agent on a transaction are paid by the seller. That means that technically and typically, the fiduciary duty of any agent involved in a transaction belongs to the seller. An agent you meet at an open house or contact online might take you around to various listings and provide you with loads of information but – technically – they are not representing you. They represent the sale of the property (even if they are from a different brokerage than the property you’re looking at).
Unless you sign an agreement with an agent to represent you as a buyer’s agent. In that case, it means you have a contract with that agent for their fiduciary duty to belong to you.
Now, to be completely fair, 99.999% of agents working with any buyer are going to do their best to get their client the absolute best deal – even if they don’t have a formal Buyer’s Agent agreement in place – because ethically and morally it’s the right thing to do. But it’s important to recognize that unless you have an agreement in place that states that the agent is your exclusive Buyer’s Agent, then – at the end of the day – their job is to get the property sold, whether it’s to you or to someone else.
What Should I Do To Prepare My Home For Sale?
The first thing you should do when preparing to sell your house is pretend it isn’t yours. Walk around with the same critical eye you used the first time you saw the property – what do you see that looks out of place or like it needs a bit of a touch-up? You don’t necessarily need to replace every single fixture and repaint the entire interior of the house, but it makes it much easier for a buyer to imagine themselves in the house if they feel like it’s move-in ready. You can also go around and “depersonalize” your home a bit.
This is good for two reasons: first, it makes it easier for a buyer to envision their belongings – and their family – in the space instead of yours, and second, it ensures that when you have professional photos taken for your online listing, that there are no images of your kids or personal and/or valuable possessions in the public domain.
This tip goes for the outside of your home as well. Look at the rest of your neighborhood and then critically examine your curb appeal. You don’t need to have the absolute best lawn on the street, but you want to make sure everything is neat and tidy and that nothing looks wildly out of place from the majority of your neighbors.
You can also pay to have an inspection done on your own property. This would be the same type of inspection that a buyer would do as part of their due diligence before purchasing the home, and it will alert you to any major issues that could come up for a buyer. With that information handy ahead of time, you’ll have options like making repairs before you list the home, adjusting the list price accordingly, or simply keeping the information for peace of mind so that you aren’t caught off guard during negotiations.
What Is The Current State Of The Real Estate Market?
We can’t necessarily answer this question right now (after all, the answer depends on when you read this article!), but some ways to tell if we’re in a buyer’s market or seller’s market are to look at the following factors:
- How much inventory is there on the market right now?
- How long are properties staying on the market?
- Are sellers reducing the list price after a period of time?
If the answers to these questions are “not a lot,” “a hot second,” and “not even a little bit” then we’re likely in a seller’s market. Conversely, if there are tons of properties available, they’re all staying on the market for a few weeks without a signed offer, and sellers are slashing prices, then it’s likely a buyer’s market.
What Are The Closing Costs Involved In Buying Or Selling A Property?
The closing costs depend on the exact specifications of the particular property and transaction but are likely to include some or all of the following:
- Agent fees
- Attorneys fees
- Inspection costs
- Appraisal fees
- Title search fees
- Prepaid expenses (property tax, homeowner’s insurance, etc.)
- And more.
The buyers pay some of these fees, and the sellers pay some – and while many of these items are fixed costs that can’t be negotiated down in price, it’s not uncommon to negotiate who will pay the closing costs upon the final sale of the house.
What Are The Best Neighborhoods To Buy A Home In?
This is NOT a one-size fits all answer. Some people may prefer an area with an easy commute to their jobs and be willing to sacrifice square footage in their home for that convenience, while others may prioritize a home with lots of space but a long ride. Some people may want to be “in the heart of it all,” while others may prefer a quieter, more nature-inspired setting.
Determining the “best” neighborhood is entirely up to the buyer. That said, in addition to considering factors that are important to you and your family specifically, there are other items you can look at that may help you decide whether a property is in an area that will be a good investment. For example, if new businesses are moving into town – especially a Starbucks – it can be a good sign that property values in the area will increase.
We understand that entering the housing market – whether it’s your first time or your 10th time – can be overwhelming. The real estate agents at Wilson Associates are ready to answer your questions and help you decide what your next property move should be. Let’s chat!