Hi Lesslile,
How many homes should I see before I make a decision and buy? My friend says 45.
Hello Jerry,
On, November 17, 2010, RISMEDIA published a lot of information that indirectly answers your question. Personally, I think 45 are too many although there are Realtors who disagree. The Rismedia article stated that "Five years ago, a serious buyer who was pre-approved for a mortgage loan typically spent three to four weeks looking for a home and usually visited 15-20 homes, and now many people tend to look much longer. Buyers have a hard time saying ‘yes.' One Chicago agent reports "One couple I'm working with has looked at 42 or 43 houses and still hasn't made an offer. But that isn't unusual in today's market."
"Kathleen O'Reilly of RE/MAX Horizon in Elgin, Ill., reports she recently set a personal record by showing one client 45 houses. The client then made an offer and purchased a home-the first one O'Reilly had shown him. That first home had everything the buyer wanted, according to O'Reilly, but he had to look at 44 other homes before feeling confident he was getting the most for his money.
"What I'm seeing," said Ritter, "is that buyers have read a lot about foreclosures, short sales and how desperate sellers are. They feel there is this fabulous deal out there, a mansion with all the bells and whistles, and they are going to get it for $210,000. They are convinced the next house they look at will be a better deal, and with so many inventories now on the market, they keep looking and looking."
How can buyers find their way in the current marketplace, with its shifting home prices and an extensive inventory that includes many distressed properties? Here's some advice on how to speed up the process from experienced real estate professionals at RE/MAX, and added to and subtracted to by yours truly, Lesslie Giacobbi
-Do enough looking to get to know your local market. It is good for a buyer to remember that each local market has its own character, and buyers must adjust their expectations accordingly. Buyers need to drive an area they like or where they would like to buy. Buyers need to understand the nuances of a location, why a house on one street brings a higher price than the same house on another street. What are the school districts for each house they are looking at and how to they affect price? Buyers on their own should look thoroughly on-line, and visit a lot of open houses to get an idea of value, and an idea of the community. They should ask lots of questions of an agent so they better understand the local market. This will allow them to recognize a good value.
-Let your emotions help you. Deborah Cassidy of RE/MAX Showcase in Lake Forest, Ill. Says that too often today, buyers aren't letting themselves fall in love with a home, "They are only looking at price and condition, and that contributes to their uncertainty because they always feel there's a better deal out there," she said. "Leaving emotion out of the equation makes it difficult for buyers to commit to a purchase." My thought-why buy something that doesn't thrill you and make you happy each time you come home?
-Decide if a distressed property is really right for you. Foreclosures and short sales can offer buyers great value but not always. There are many cases whereby a foreclosure might be a slightly better deal or a lower $ per sq. ft, but if a buyer calculates what it will cost to fix up, it might not end up being a good deal. For a short sale or a foreclosure, Dan says "Buyers must decide if they have the patience and flexibility to pursue a short sale and the skills or resources to deal with repairing a foreclosure," Short sales, while usually in better condition, can take months to get to the closing table, and in at least some cases these transactions eventually fall apart because the lender, seller and buyer can't agree and a foreclosure may be imminent.
-Don't focus too heavily on price. Make sure you take everything into account. That means look at the benefits of purchasing, the interest deduction, and property tax deduction. Today, we are still at the lowest rates we've had for mortgages, and rates can only go up. Buyers should take advantage of these rates, and the increased inventory so they can close NOW
-Be ready to negotiate. According to Kathleen O'Reilly of RE/MAX Horizon, Elgin, buyers can miss out on a great home if they don't initiate a negotiation. "When buyers find a home they like, I encourage them to make an offer at a price they are comfortable with, even if it is well below the listed price," she said. "At worst, the seller won't negotiate, but in this market that is unlikely. Sellers don't want a viable buyer to walk away. If a negotiation is initiated, it often ends up in a place that makes the buyers happy because in this market sellers have to do most of the compromising."
-Get plenty of advice but trust the professionals. Even though we are in a price driven market, that doesn't mean that a seller will take "any price" or a lender is going to jump at an offer that is below current market value. The Market is complex and there are many factors that affect it. Make sure you talk to a professional, a lender, real estate age, or appraiser-people who are current in the market place and know what is happening to value.
-Don't let negative comments about the housing market scare you off. Those who mean well may wish to warn you about the downside risks of the housing market, according to Mark Zipperer of RE/MAX Edge in Chicago. "However, buyers shouldn't lose sight of the many positives in the current market, such as the fact that home affordability is at its highest in decades and that investors are flocking into the market to snap up bargains in all-cash purchases," It's good for buyers to figure out exactly how much a property will cost them-what their monthly payment will be for all expenses, including future maintenance, and unforeseeable items.
To see the whole article, go to
realestatemagazinefeedback@rismedia.com.
Lesslie Giacobbi is a Realtor with
Seven Gables Real Estate in Anaheim Hills.
Contact her at 714-608-6646 or lesslieg.featuredblog.com
Comments(2)