Buying a home is one of the biggest financial steps you can take. Buyers often get overwhelmed by the process and forget to make the right inquiries before buying a property. Your real estate agent is an excellent source to help guide you, so be sure to use him or her.
Here are some questions you should ask before making an offer:
Can I See a Comparative Market Analysis?
Your real estate agent is not allowed to tell you what to offer, because that breaks the ethical code of the industry. However, he or she can help you understand what the home is worth through a comparable market analysis. A comparative market analysis shows comparable sales, or "comps," for similar homes that have recently sold. You can look at these sales to ensure the price you are offering, or the price the seller is asking, is fair in light of current market conditions.
How Long Has the Home Been on the Market?
Ask your real estate agent how long the home has been on the market to gauge if you have any negotiating room. If the home has been on the market for a long time, but nothing appears to be wrong with it, you may be able to offer a price far below what the seller is asking. The seller is likely highly motivated to sell.
How Flexible is the Seller?
A real estate agent is hired for more than showing homes; he or she knows the local real estate market inside and out, and also networks with other agents. Often, the real estate agent will use those contacts to learn a little about the seller and his or her motivations. You can estimate how much negotiating room you have by asking about the seller's flexibility. Don't forget to ask about whether or not the seller will negotiate the closing costs on the property — this is one area where you may be able to save a bit.
What Problems Does the House Have?
If your state has mandated disclosure forms for real estate, then you may have a better idea of what problems the house has - but if not, ask the real estate agent. While the agent has to be tactful about showing issues with the house, he or she is an expert and can carefully guide you toward seeing problems your untrained eye might overlook. A problem does not necessarily mean you shouldn't buy the home, but it is something you should know before deciding to buy.
Is a Short Sale Possible?
If the home seems overpriced for the current market, it may be because the owner owes more on the property than it is currently worth. While the seller does not want to lose money, the lender is likely the one preventing the seller from offering a lower price. Ask the agent whether or not a short sale is possible before making an offer. If the short sale is not a possibility, there's no point in making a low offer. If it is, then you might be able to get a great deal on the property.
What Is the Neighborhood Like?
This particular question can be tricky — real estate agents are ethically prevented from steering you away from the property because it is in a "bad neighborhood." However, they can give you insights into the neighborhood, showcasing features like traffic flow, overall quietness and the proximity of retail and employment options. Also, if you give your real estate agent a list of things you want in a neighborhood, he or she can help you determine if the home is a good fit.
When Could I Move In?
Once you find a home that meets your criteria, don't forget to ask about how soon you can move in. This information will be invaluable as you plan your moving date and schedule your moving crew. Most real estate agents will tell you the move can happen after the escrow or closing, but a skilled agent will be able to give you a good idea of how long that should take.
What Are the Monthly Utility Costs?
While your agent will not know the answer to this, he or she can ask the seller's agent, and give you a realistic number for utility costs. Having a clear understanding of these costs will help you decide if you can afford the new home, and any potential utility cost increases.
Remember, a quality real estate agent wants not only to sell a home, but to sell a home you will love. Real estate agents want to see their customers happy in their new homes, and you are no exception. Ask the right questions, and you will be on the way toward finding a home that’s right for you.