5 Tips and 1 Important Warning for First-Time Home Buyers

Buying a house is a complicated and frightening process, and it is important to be prepared. Knowledge is power when it comes to negotiating the difficult world of home prices, interest rates and mortgage loans. For a first time home buyer, there are many factors to consider before you buy. The more information you can gather before you start shopping, the better off you will be.

1: Ask yourself if you’re ready.
You need to decide whether you’re financially ready to buy a home, says Connie Barbosa, vice president and branch manager of Slade’s Ferry Bank in Somerset, Mass. She suggests first-time buyers ask themselves some simple questions:
Do you have a steady job and income?
Do you plan on remaining in the same area for a few years?
Do you have enough money set aside for your down payment and closing costs?
Do you have an emergency fund?
Do you live within your means, avoiding credit card debt?

2: Find out what you can afford.
When you’re sure you have the right mind set to be a homeowner, it’s time to determine how much house you can afford. Web sites such as Fizber.com, Zillow.com and Homegain.com can give you a general idea of what you should expect to pay. You can also do a quick search of actual MLS listings in your area on a number of Web sites, including the site of the National Association of Realtors.

3: Find out what’s available.
Now it’s time to decide where you want to live and research what types of housing are available — one-story single family, condos, town homes, etc. You can get an idea by looking at ads and driving around the community before you ever call a real estate agent. In searching for an agent, find one who makes you feel comfortable and, more importantly, one who listens to you.

4: Choose a neighborhood.
Once you know the housing stock, you can look at specific neighborhoods. Cruise by at night time to see whether you get a “vibe” that it’s a safe neighborhood. If you have children, you’ll want to check out the quality of the schools. You may want to check out what types of large-scale facilities (airports, highways, chemical plants, etc.) are nearby, and whether you’re convenient to shopping, work and schools. You can do much of this independently, but you can also ask your agent to help you find sources of information about such things. Moreover, you can do it yourself using a broad-purposed neighborhood estimating tool Fizber Drive Score.

5: Negotiate.
Once you’ve found the house you want, you should make an offer that’s lower than the seller’s asking price. The seller expects this and will likely make a counter-offer. You have to decide before you start negotiating what your make or break point is, and stick to it. Just be reasonable. Don’t expect the seller to give you a 50 percent discount on a good property.

WARNING! The “Red Shoes” Experience
Women will relate to this. Say, you need a new pair of red shoes. You go to the mall. At the first shoe store, you find a fabulous pair of red shoes. You try them on. They fit perfectly. They are glamorous. Priced right, too. Do you buy them? Of course not! You go to every other store in the mall trying on red shoes until you are ready to drop from exhaustion. Then you return to the first store and buy those red shoes. Do not shop for a home this way. When you find the perfect home, buy it.

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# The two-car garage is outdated. Families are growing. People own "summer" and "winter" cars. Teenagers own cars. Some home buyers base their entire home-buying decision on the type of garage that comes with the house. One home buyer specifically decided to purchase a certain home because it had a four-car garage. He ran a landscaping business and needed to park four cars, plus have RV access. One house in Sacramento fit those needs, so he bought it. # Auto Elevators. For less than it costs to buy a used Honda, you can hire a company to install an auto elevator in your garage. It works like this: you drive into the garage, get out of the car, push a button and your car rises. Then you can park another car underneath. Or you can dig out the ground below to provide subterranean parking. The lift and your car will be completely concealed. Garages Are Getting Bigger Back in the ’80s and ’90s, a standard-sized garage measured about 21 feet by 21 feet and was 7-feet high. Consider the length of a H2 Hummer, about 15 feet long, which doesn’t leave a lot of room for typical garage items such as a lawnmower, gardening tools or workbench. A 17-foot Bayliner boat, with trailer and hitch, won’t fit in a smaller garage, either. To accommodate our larger vehicles, garages need to be at minimum 22 feet by 22 feet. To fit an SUV, the height should be at least 9 feet. Garages Moving to Rear of Home To increase the number of homes on lots, builders are moving garages to the back of the home. The garage is accessible by side entry or from an alley, just like the 1950s. Although some are attached at the rear, the trend is moving toward detached garages. Rear garages, builders say, emphasize the fronts of the homes and encourage interaction between sidewalk strollers and porch sitters. Source: Fizber.com

Do you think your house is worth as much today as it was last year? With all the gloomy news about the tanking housing market, one would think most people would be equally pesimistic about the value of their homes, but surprisingly a new study shows most people believe their home is worth the same or even more this year. The survey, by the real estate Web site Zillow.com, said people must be either in denial or not paying attention because, nationwide, 62 percent of people think their home is worth the same or more than last year, when in reality, 77 percent of homes lost value. Californians are less optimistic; 28 percent think their homes are worth more, but in reality, only 9 percent increased in value. Source: Fizber.com

The shifts in markets throughout the country make many cities a great destination for first-time home buyers in 2008. Here are four example cities; all data is provided by Cyberhomes.com. Cincinnati, OH Market Information Median home value: $194,728 Median household income: $44,704 Unemployment rate: 5.2 percent Recent job growth: 1.12 percent Search Cincinnati Real Estate Gainesville, FL Market Information: Median home value: $145,134 Median household income: $19,515 Unemployment rate: 2.9 percent Recent job growth: 4.4 percent Search Gainesville Real Estate Indianapolis, IN Market Information Median home value: $182,406 Median household income: $62,496 Unemployment rate: 5.0 percent Recent job growth: 0.39 percent Search Indianapolis Real Estate

When buying a home for the first time it is most likely the biggest financial decision you have made thus far. Now you are at a point when selling your home, for what ever reason, is just as big of a financial decision as buying. No matter what the reason for selling your home you still want to get as much of your investment back as possible. There are 3 key points to consider when pricing your home, market conditions, targeting, and price. 1. Recognize that housing markets are local. Home prices are like the weather — very different in different areas. In addition, demand will change depending on the price range and even the neighborhood. What you need to know: What’s the demand for a house like yours in your area? Look at comparables for similar houses. Study prices and sales for one year ago, six months ago, three months ago and current numbers. What are the trends? Are prices going up or down — and by how much? How many days are homes staying on the market? If they are on the market longer, how much of that could be seasonal? In many areas, spring and summer are the busy seasons. Pay special attention to the delta between the list price and the sales price. That is, look for a meaningful relationship between list price and sales price. Perhaps most homes are selling for 5 percent less than the list price. If you’re not using a real estate agent, it’s especially important to use the Internet, visit open houses in your area and study home sales in your Sunday paper. But you also need to realize that the paperwork alone only tells part of the story. While sales and prices are public, many times seller concessions are not. 2. Analyze who is buying and selling in your market. What’s your competition? Who are the buyers, and why are they shopping? Do you live in an area like Phoenix, a growing market with people coming in. Or are you living in an area that doesn’t attract a lot of new residents, where many shoppers are bottom fishers who don’t have to buy but are looking to pick up a bargain. Are you competing against a flood of new houses from builders eager to sell, or are you selling a newer home in an area where most of the housing stock is older? 3. Consider strategic pricing. Here’s how it works: If prices in your area are dropping 1 percent each month, and you want to sell within the next three months, you take 3 percent off your price right off the bat. So if you were going to put your home on the market for $400,000, you set the price at roughly $388,000. The upside: You’ll have the competitive edge over the guy who’s dropping his price every month, without the air of desperation. Plus, in a market where prices are falling, you’ll make more money if you sell quickly. The downside: Predicting the market is a tough call, even for the pros. And it’s really difficult to raise the price if your market starts to rebound. Source: Fizber.com

* How long have you lived in the neighborhood? * What do you like best about living here? * What do you like least about the neighborhood? * If you could change one thing about this street, what would it be? * Do all the neighbors get along with each other? * Have you ever noticed anything odd about this house or yours? * How is the crime in this area — has anything happened around here? * How quiet is the neighborhood? Are there nuisances? * Do you know why the seller is selling this house? * What has the owner of this house complained about to you? You’ll be surprised what the neighbors might tell you and what you could find out. It might save you from making a terrible buying mistake and moving into a neighborhood where you could be miserable down the road. When selling your home, if circumstances warrant, make amends with the neighbors before putting that sign in the yard. Because buyers will talk to the neighbors before fully committing to buy. Source: Fizber.com

If you want to sell your house, the usual drill is to clean the closets, repaint chipped kitchen cabinets and call a broker. Then, to boost the price, many people hire a professional stylist or "stager" to fine tune the décor. But what about those overgrown hedges, the crab grass in the backyard and borders that have seen better days? Gardens and landscaping are often overlooked when a seller spruces up a home. Barbara Schwarz, a broker and founder of the Web site Staged Homes, which offers an accredited staging program, says that pruning a garden is as critical to selling as creating a Real Simple-inspired interior. Her tips include weeding and mulching, maintaining freshly trimmed ground cover like ivy, and placing evergreens or pots of flowering annuals near the front door to make the home more welcoming. Some experts say that overgrown gardens should be avoided. Others believe that buyers prefer houses with larger shrub borders and smaller lawns, so there is less grass to mow. Real estate organizations do not specifically track the impact of landscape improvements. Anecdotal evidence suggests that a well-tended garden does add a certain cachet as part of a home’s overall renovation and could add dollars, too. More: Fizber.com

Lender as authority A lender approves the sale, rather than the individual home seller. Offer response Lenders take an average of 4.5 weeks to OK a short sale offer, according to IFM/Campbell data. A regular seller usually responds within days. Deficiency notes Short sale sellers can transfer a home to a new owner for a price below their mortgage balance, but they may still have to repay the outstanding mortgage balance. Some lenders make sellers sign a “deficiency note,” or repayment agreement. Seller/lender coordination Sellers need to file documents and/or secure an OK from their lender to close a short sale. Buyers should investigate where sellers are with this process to get a sense of how long the transaction will take. Agent commissions Some lenders will forego paying (or pay reduced) real estate agent commissions on these deals, leaving consumers to pay commissions outright or forcing agents to compromise some or all of their fee.

To directly access this article visit Fizber.com

Here’s a new item we’ll try to bring you from time to time: Celebrities in Foreclosure. Today, the pride of Thousand Oaks, the Olympic Golden Girl, Marion Jones.

As Lance Pugmire reports in L.A. Times, Marion Jones is down to her last $2,000, and last year a bank foreclosed on her $2.5 million cheateau-style "dream home" in Chapel Hill, N.C.

Jones — who was seen driving a Porsche SUV last year — says she’s not sure where the money went. "Who knows? I wish I knew. Bills, attorney bills, a lot of different things to maintain the lifestyle."

The rest of this story is at Fizber.com