1. Don't Get Pre-Qualified.
Get pre-approved.
Do you want to get the best house you can for the least amount of money? Then make sure you're in the strongest negotiating position possible. Price is only one bargaining chip in the negotiations, and not necessarily the most important one.
Often other terms, such as the strength of the buyer or the length of escrow, are critical to a seller. This process takes anywhere from a few days to a few weeks depending on your situation. It's VERY POWERFUL and a weapon we recommend all of our clients have in their negotiating arsenal.
2. Sell First, Then Buy.
If you have a house to sell, sell it before selecting a house to buy!
Let's pretend that we go out looking for the perfect house for you. We find it and
you love it! Now you have to make an offer to the seller. You want the seller to reduce the price and wait until you sell your house.
The seller figures that's a risky deal, since he might pass up a buyer who DOESN'T have to sell a house while he's waiting for you.
So he says OK, he'll do the contingency but it has to be a full-price offer. So you see, you paid more for the house than you could have because of the contingency. Now you have to sell your existing house, and in a hurry, otherwise you lose the dream house. So, to sell quickly you might take an offer that's lower than if you had more time.
3. Play the Game of Nines.
Before house hunting, make a list of nine things you want in the new place. Then make a list of the nine things you don't want. We call this Nine of This and None of That.
You can use this list as a scorecard to rate each property you see. The one with the biggest score wins! This helps avoid confusion and keeps things in perspective when you're comparing dozens of homes.
When house hunting, keep in mind the difference between skin and bones. The bones are things that cannot be changed such as the location, view, size of lot, noise in the area, school district, and floor plan. The skin represents easily changed surface finishes like carpet, wallpaper, color, and window coverings. Buy the house with good bones, because the skin can always be changed to match your tastes. I always recommend that you imagine each house as if it were vacant. Consider each house on its underlying merits, not the seller's decorating skills.
4. Don't Be Pushed Into Any House.
Your agent should show you everything available that meets your requirements. Don't make a decision on a house until you feel that you've seen enough to pick the best one. Review the Multiple Listing printout with your agent to make sure that you are getting a COMPLETE list.
In the late 1980s, homes were selling quickly, usually a few days after listing. In that kind of market, agents advised their clients to make an offer ON THE SPOT if they liked the house. That was good advice at the time. Today there isn't always this urgency, unless a home is drastically under-priced, and you'll know if it is.
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