Seven Common Mistakes to Avoid in Real Estate
1. Failing To Have A Plan .
Evaluate your current situation. Why are you planning to sell your house? Are you moving up to a larger house? Do you need the money out of this house to make your move? One thing you need to do is to get a realistic idea of exactly how much cash you will be getting out of this house when it sells. Are you going to move locally? What mortgage amount can you really afford with payments including higher taxes and insurance? Can you afford a house significantly better than the one you already have. Are you moving down to a smaller property? What are you going to do with your furniture and other things that you have collected over the years? Will be comfortable in a smaller place? Are you retiring? Moving locally or out of state? Are you going into a retirement community? What activities do you expect to be involved in after working days are over? Are you moving out of the area because of employment? How fast do you have to be in your new location? Are housing costs higher there, or lower? Is your employer helping with sales costs, moving, costs, temporary housing, etc? How does your family feel about the move? One reluctant teenager can seriously undermine the entire process. Are you the executor of an estate? What is the time schedule for your plan?
2. Failing To Take A Hard, Serious Look At The Condition Of The House.
Houses wear, paint gets dull and shabby, landscaping can become overgrown, and roofs deteriorate Often times as we live in a house we “live with” minor inconveniences that we intend to fix “Some day.” It is not unusual to not notice conditions that are glaringly obvious to a buyer. How old is your roof? An average lifespan is 25 years. How old is your furnace? An average lifespan is 15 years. How old is your hot water heater? An average lifespan is 10 years. Is there asbestos insulation covering your beat pipes in the basement? Do you have a septic system? Has it been pumped and fully inspected within the last two years? Is there any obvious water damage from old leaks? Have you had any improvements done to the house without permits and inspections? Are your hardwood floors scuffed and scratched? Are your carpets worn? Any of these conditions that are noticed by the buyer may make him bypass your house and buy another. Or any found during the home inspection can cause the buyer to cancel the sale. It is best to have someone with fresh eyes take a hard critical look at your house. A good Realtor will do this and make his or her recommendations.
3. Failing To Properly “Screen” Your Realtor.
It’s likely that you don’t often interview people. Yet, in order to find the Realtor who is right for you, you may need to interview several. The quality of your home buying experience is dependent upon your skill at selecting the best-qualified person. It’s interesting that in the real estate business someone with many successfully closed transactions usually costs the same as someone who is inexperienced. Bringing that experience to bear on your transaction could mean a better price at the negotiating table, selling in less time, and reducing the number of hassles. Your agent should be a skilled, win-win negotiator!
4. Failing To Get Pre-Qualified For The Home Loan On The Next House.
Don’t waste hours searching for a home that is not in your price range! Save time and money by pre-qualifying for a loan. Before you go shopping for a home, you need to determine how much you can afford. You can get pre-qualified at http://www.LovelySalemHomes.com and click on Mortgage Information. We have links to 4 great lenders. Once you are pre-qualified for a mortgage, you will know your buying power-you will save time by looking only in your price range. This process is simple. A lender will ask you basic questions concerning your history, run a credit report, and determine your buying power. You can even get pre-approved for a loan! Imagine for a moment that when you and your Realtor initially draft your offer for the home you select, you are already approved for the loan- IN ADVANCE. No stress, no worrying about qualifying, no concern whatsoever about your ability to qualify would stand between you and the home of your dreams. In today’s market, a pre-approval can be a powerful negotiating tool. Many owners will not accept an offer without a pre-approval. If there is more than one offer on the same house, the pre-approved buyer has the advantage. You deserve peace of mind and negotiating power by getting an approved loan before you make an offer.
5. Pricing The House Incorrectly.
Whether a house is priced too high or too low, it can cost you thousands of dollars. Obviously a house priced too low will net you less cash at closing. However, a house priced too high will take longer to sell. The homebuyer today is an educated consumer. On average a buyer will see 18 homes before purchasing. The house that sells today is the best one on the market in the price range. The sale of a house is a competitive enterprise. Ask your Realtor to show you what homes you are competing against. Some people will say, “I can always lower my price later.” Both Realtors and buyers are looking for new listings. Rarely do they notice a reduced price. The saddest sign anyone can put on a sign rider is “Price Reduced.” That means the house was not priced right in the first place. The buyers will ask, “If the price was wrong, what else is wrong?”
6. Failing To Obtain A Home Inspection From A Qualified Inspector.
The job of a professional home inspector is to look over every major part of a home and write a report that judges the homes quality and condition. A home inspector reports on the structural and mechanical condition of the home. A well-qualified inspector who has adhered to federal licensing standards can spot problems that you might not be able to see. Expect problems to be clearly explained, repair expenses closely calculated, maintenance costs estimated, and a written report delivered within a day or two. Most-contracts are contingent upon the outcome of several inspections such as: wood-boring insects, excessive amounts of radon gas, structural soundness, and the condition of the heating, electrical, and plumbing systems. These problems must be corrected or the buyer has every right to cancel the contract. Getting an inspection up front can save money by giving you time to shop for the best repair price instead of being under pressure to get repairs done immediately.
7. Not Knowing Your Rights And Obligations.
Real estate law is extensive and complex; the contract for sale and purchase is a legally binding document. An improperly written contract can cause the sale to fall through or cost you thousands of dollars for repairs, inspections, and remedies for title defects. If there are defects in the title, or if the property is in conflict with local restrictions, you must remedy them. Some real estate companies require a “Seller’s Disclosure” form to be filled out when the property is listed.
It is your Realtors job to know the laws governing real estate transactions. They are involved in an on- going training program to keep up to date with these laws. You deserve to have an agent who is not only knowledgeable about the transaction but is also willing to educate you throughout the process so you will feel more comfortable. Selling your house?
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The Burk Team
John L. Scott Salem
725 Commercial St SE
Salem, OR 97301