Why You Want an Agent’s Advice for Your Move

Have you been on the fence for a while about buying or selling? You're not alone. A lot of people have been waiting for multiple reasons. Is one of these your reason? 

1. Interest rates. Whether you currently have a 3% loan you don't want to lose, or just want to be able to get more for your money,  interest rates are often a big consideration when pondering your real estate decesions. THE GOOD NEWS- Rates are getting better. The economists with the National Association of Realtors are projecting that interest rates will be continuing to drop throughout the year. 

2. The weather. November and December were just too busy to think about house shopping and if you have to prepare a house to sell during the Holidays, you'll surely lose your mind! But now it's single digit temperatures and double digit snowfall, YUCK. And moving in that is not appealing! THE GOOD NEWS- It generally takes about 30 days from offer acceptance to closing. It's mid-January, so by the time we find the right house and close, the weather will be starting to improve!! 

3. Home prices. Heavy competition in the housing market a few years ago made home prices climb at an accelerated rate. Values are still high, but it the rate of the increase has slowed. The market is not quite as competitive now, but there are fewer incidents of multiple offers bringing sale prices up. THE GOOD NEWS- The values have held steady. With very few exceptions, home values have maintained the value over a 0-3 year span post closing. As a home owner, you want the market to maintain so your home's value stays up.

Most Realtors are optimistic looking into 2024 for good reason! Let's talk about your situation and see what we can do to get you to jump off that fence! 

  Is this real estate market getting you down? You’re not alone. There are a lot more buyers than homes on the market right now. Especially if your price range is under $300,000.00. 

Why? Back in 2007, when the real estate market crashed new home building came to a screeching halt and continued that way for several years. Years of deceptive mortgage banking practices led to a crash and recession like we hadn’t seen in decades. Mortgages suddenly became very hard to get. Unemployment was high. While the natural attrition of the housing inventory remained the same, nothing new was coming along to fill those spots. In fact, some places, such as South Bend, lost even more housing inventory due to massive home demolition projects by the city. With virtually no new homes being built. 

What can you do to weather this storm? Don’t lose faith! 

1) Make sure that you are prepared to make an offer when you see a home you love. Get pre-approved with a local lender if you aren’t already. Local lenders can make a difference in a competitive offer situation. Local lenders are important because they are more likely to be known by the listing agent. If the agent is familiar with the lender, and knows that their pre-approval means something, then your offer is more likely to be accepted. Local lenders often work a little harder at customer service because they need to protect their reputation. Realtors talk to each other. This is not to say that there aren’t some great online lenders, but you are a stronger buyer when you use a lender that is locally known and liked. 

2) Really consider what you are willing to spend on a home you love. If it is perfect except for one thing, like a lot of highway noise, not having a dishwasher, or it’s a long commute to work, you need to consider how important that issue is to you. If you really hate a long commute each day, then that larger payment is going to be harder to tolerate. But if it has nearly everything you’ve been hoping for, then maybe it’s worth paying a bit more to have a better chance of getting your offer accepted. The decision about your absolute top dollar is ultimately yours (well…, and your lenders).  

3) Be open to ideas from your Realtor. Sometimes you can be creative if you have some cash in the bank. Remember, the seller will be looking at the NET amount, so offering to pay something traditionally paid by the seller, such as some of their closing fees or the property taxes that are normally prorated, leaves more money for them in the end. Also, take a look at things you could offer the seller that another buyer may not be able to. Some examples are: giving the seller some additional possession time after closing if you don’t need to move immediately, or offering to pay for a repair if something comes up in an inspection. It can get confusing to discuss these types of things, so if you aren’t clear on the suggestion, please ask to go over it again. Never sign a contract if you don’t understand what you are agreeing to. 

4) Waiving inspections. OK, I don’t even like to bring this one up! But there are times when it is less risky than others. As we walk through a home, I’m always looking for signs of a well-maintained home, or signs that it hasn’t been. And we’ll talk about things we see. Sometimes buying a home warranty will help you feel better about foregoing an inspection. Again, it’s all about that particular house and situation.  

5) The most important thing to remember is to be patient and don’t give up. You may have to submit several offers before one is finally accepted. That is common these days. There IS a home out there for you. We may just have to kiss a few frogs till we find it!  

Contracts can be BORING! But you really need to know a few basic things about them to make good choices as you start out on the home buying journey. Through the years, I've learned the importance of having well-written contracts. I once rented a house to a couple of boys fresh out of high school. They were responsible in many ways, but still very young and on their own for the first time. Then the neighbors started complaining about the parties. The ruts in the yard. The booze bottles and beer cans were everywhere! These guys had to go before someone got hurt. Warnings didn't help. They paid their rent on time, so they thought that was all that mattered. I was so glad for the clause in the lease that didn't allow illegal activity, such as serving alcohol to minors! Thank goodness I had a way to get them out. Contracts protect us. Contracts give us guidelines so everyone knows what is expected of them. Contracts are a vital part of the home buying process, so it is good to know a little bit about how they work.

First rule: Don't sign anything if you don't understand it! Or, before you are ready to! I look back on the start of my time as an agent and I realize that I didn't do a very good job of making sure my clients knew what they were signing. I just took it for granted that everyone would understand this. After all, as a homeowner and investor, I had signed many of these over the years. Hasn't everyone? -- No. No, they have not. And a lot of people will sign anything you put in front of them. -- Please don't be that way! -- I truly appreciate your trust in me, but you will be mad at me if you end up with buyer's remorse. I now instruct clients to read the contract before signing it. Sometimes I'll send a blank copy for them to read before they even find a house they want to buy. And sometimes I'll meet you where we can sit down, have a cup of coffee, and actually go through a Purchase Agreement line by line. If you have any doubt that you are clear on what you are getting yourself into, DON'T SIGN IT. 

Next: Anything you sign in a home sales transaction is legally binding. And anything you don't sign is not. So if you sign a Purchase Agreement and don't follow through with everything you have agreed to, you could be sued. Yes, you could be forced to buy a house you don't want if you don't handle this part right. (FSBO* buyers beware!) This is called specific performance. On the flip side of that, spoken words mean nothing in real estate transactions. If you want the lawnmower in the garage, you have to put that in writing. Otherwise, the seller has every right to take it with him, or give it to the kid next door. Even if he told you that you could have it.

Five parts to a contract: 1) Offer - in this case, you are agreeing to give someone money for their property. 2) Acceptance - when the other party signs it, they are accepting your offer. Signatures from the buyers AND the sellers? You have a deal! 3) Consideration- AKA $$$$ 4) Both sides agree to do something. 5) The parties on both sides must be competent and able to commit to the agreement. If you have all these things, you have a binding agreement. Congratulations!

"Time is of the essence": Dates are very important in real estate transactions. There is a start date, an end date, and dates for certain things to happen. Pay attention to these! Missing a deadline could put you in default of the contract. That could put you in danger of being sued, or giving the other party an excuse to get out of it if a better offer comes along. The start date is when the last signature of the parties is added. The end date is normally either closing day (Yay closing day!!) or the possession date. Either way, there is a point after both parties have performed the duties outlined in the contract, that they are free of responsibility to each other. So be sure you are satisfied before signing at closing! 

Keep in mind that I am a realtor, not an attorney. If you need clarification or advice about an agreement you are about to sign, you should consult with an attorney.

Hopefully understanding this part of the process will take some of the anxiety away- and potentially keep you out of a big mess! 

Happy house shopping!! 

- Sara

*FSBO- For Sale By Owner