Purchasing real estate is typically the largest investment a person makes – and being an informed Buyer will foster informed decisions. The consequences are minimal when second guessing which coffee to order, but second guessing on real estate can have financial and emotional consequences for years to come.
After working with and consulting Buyers for the last 8 years, I have met people from being knowledgeable and prepared to genuinely clueless on the entire process. Regardless of where you are on the spectrum, I would like to share with you some of the keys to becoming an informed Buyer so you can make informed decisions and be a happy homeowner.
1. Real Estate is Local. Remember this when you listen to the news and read information online. It is not just limited to Sarasota County but can be narrowed down to neighborhoods, condominiums or just a few streets. So often, the Buyers and Sellers I work with are from outside of the state or even the country. They arrive with certain notions and after meeting to analyze the local Sarasota market, realize that their understanding doesn’t always match with what they have heard on a national level.
2. Know When to Lowball. Buyers want a deal – who doesn’t? When I have a Buyer interested in a property, I ask the listing agent a number of questions. Why does the owner want to sell? Do you know how flexible they are on their price? Have they had any other offers? Then, we take a look at the comps. If this property were to be appraised, approximately how much would it appraise for? Depending on the list price, an offer may appear to be low even when it is close to the comps. When you find the right property you can run the risk of souring the negotiations when coming in with a low offer. We are also starting to see multiple offers on properties. Certainly a Buyer can offer any amount on the property, but with low inventory and low interest rates, the days of putting in low offers on one property after another to see who will bite are in the past.
3. Ask For Incentives. “Everything is negotiable” tends to be the standard answer to many questions – and it is true. But, before you write an offer and then request that the Seller pay for all closing costs, provide a credit for the cracks in the driveway, pay two years of association dues, and resurface the swimming pool – you need to look at the big picture. The worst the Seller can do is say no. Right? Well, not necessarily. Think about these incentives in relation to your offer. If the offer is well below market value and you ask for a couple of extra items, Sellers may not take your offer seriously. Instead, combine a stronger offer with a reasonable incentive to increase the likelihood of striking a deal. Again, with low inventory, Sellers just need to price the property well and do not need to offer creative incentives to get attention.
4. Get Pre-Approved. A pre-approval letter needs to accompany an offer for a short sale or bank owned property. It is also beneficial for a non-distressed sale, especially if there are multiple offers. It is best to know up front exactly what your budget is and the lender can provide the associated closing costs, so you can be prepared.
The takeaway thought is – know the local market and properties. When you understand the comps, you will make better decisions. Let me know which neighborhoods or condos you have interest in and I can set you up on a search for all of the listings, including active, pending and recently sold. Then, I can fill you on how value is determined for a specific home or unit. Adjustments need to be made for condition of the property, view, and other amenities. The value of a Gulf view over a city view in St Armands Towers North is different than in L’Elegance.
From there I can provide other information you need based on your goals and circumstances.
To get started, you can search for listed properties on my website.