Buying a home is fun! Paying too much for it is not. But how do you know if you're overpaying? Here are three ways to make the right offer and buy your new home at the RIGHT price!
#1 - Look at homes!
The best way to feel comfortable making an offer on your dream home is by having other homes to compare it to. Think about it. How many times have you bought things, and realized you needed to do your research first? You looked around, saw what you could get for your money, and bought what you felt was the best option for you. Buying a home is no different.
When you look at homes, first online and then in person, you can get a great idea of a number of things. How far will your money go? What kind of home will that money get you? Would you rather buy a smaller home that's move-in ready, or a bigger home that needs some work? This comparing and contrasting of the different homes you see will help you make the right offer on the home you're interested in.
#2 - Have your agent show you comparable sales!
When a real estate agent talks with homeowners about selling their home, they show them recent comparable sales. This is so the homeowners know how to price their home. A buyer's agent can do the same thing.
When I help a client buy a home, I make sure to share with them similar properties that have recently sold. This is an important step in not overpaying, because you will be able to compare, side by side, what the market looks like compared to the home you're interested in. You will also get other great information, as well, like how long those homes were on the market, whether they had any price reductions, and what kind of shape those homes were in. All of these come together to help you make the right offer on your new home.
But what if you do all that, and you're still not sure about the price? That brings us to our final safeguard!
#3 - Get an appraisal!
An appraisal is when your lender (if you're getting a mortgage) sends someone out to give an expert evaluation of the value of the property. What an appraiser does is similar to how a real estate agent can give you recent comparable sales, but they go in much greater detail. Lenders require appraisals so they can be sure they are not lending more than the property is worth.
An appraisal can protect you from paying too much, since the lender will not want to give you a mortgage if the appraisal comes in low. If that does happen, you have the potential to renegotiate the sale price of the home, or simply walk away. Either way, you are protected!
One more thing
For more on how to successfully buy a home in today's market, be sure to get my new ebook, "The Home Buying Blueprint". You can request one by sending an email to mark@MoveMeMark.com. And if you have any questions, please let me know!