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Winter Park / Maitland Observer Wednesday, Mar. 11, 2015 7 years ago

Christina Rordam: Frequently asked real estate questions

Check with your Realtor to review recent local sales in the area as well as market conditions.
by: Christina Rordam

FAQs for buyers

What's the first steps in purchasing a home?

  • Make your wish list

  • Talk to a Realtor

  • Get pre-approved (not pre-qualified) with your lender

What should I offer on the home I want to buy?

  • Check with your Realtor to review recent local sales in the area as well as market conditions. Good homes go fast now so don't wait if you will regret losing out. Currently we are in a sellers’ market. Avoid concessions and lowball offers if the property is valued properly and you are competing with other buyers.

Should I get an inspection?

  • Yes. Yes, yes, yes.

What happens if my home doesn't appraise?

Firstly, review the comparables with your realtor to know the market values prior to placing your offer. That way you will have a strong idea of what an appraisal will come back at and this step will eliminate many problems in itself. Typically if a home doesn't appraise, either the seller will reduce their price to meet the appraised value or allow the contract to be dissolved. In some cases, such as new homes where a buyer has selected a large number of custom upgrades, the buyer may be asked to bring additional monies to compensate for any gap in appraised value and contract price. Some contracts have a provision wherein the sale is contingent upon an appraisal at or above the contract price. If it does not you can ask your realtor to add verbiage to that effect to the contract.

I am buying a home that needs repairs and want to begin the remodel right away. Can I start before closing?

No. This places you at legal risk on many levels. Wait to move in and do any repairs or upgrades until you have closed and funded.

Why do I need a pre-approval?

Sellers in 99 percent of the cases will not consider an offer without this. A pre-approval shows you are serious and have allowed a loan professional to verify that you can qualify for their home and that taking it off the market to execute your contract will not be a waste of time. It's also important to help determine what you can afford and want to spend on your new place. Even the most vigilant of consumers may find surprises lurking in their credit reports or discover steps they can take to improve their interest rates and approval amounts. This is a necessary and beneficial step for all parties in the home buying process.

What can I do to maximize my chances of successfully acquiring the home of my dreams?

Focus your search on the areas that you like the most. The narrower your search area the better you can keep an eye on the new properties hitting the market therefore making it easier for you to place an offer quickly. Know what you want feature wise in a home. This may evolve during your search; that is fine. The clearer the vision of what you want the easier you will be able to find it. Be reasonable. Homeownership in itself is valuable and helps you build equity for the future. Understand that you may not buy that mansion of your dreams the first time out and focus on the things that are most important to you as well as factors you cannot control such as location. Get a pre-approval. Hire a Realtor; as a buyer their services are free and a good negotiator can make all the difference. Get an inspection. Keep concessions and repair requests to a minimum and simply be reasonable in this area. Things like outlet covers and paint touch ups are easy and cheap to do. Try to keep your requests if any to major or truly needed items if they arise. Respond quickly to requests from your lender and agent for paperwork. This will keep your closing date on track and ensure a smooth process. Keep your emotions out of it whenever possible.

I'm considering purchasing a new home. Should I hire a Realtor?

Yes. A buyers’ agent has your best interests at heart and can show you all the other options so you know what is out there prior to purchasing your new home. They will also act as your advocate in the entire process, ensuring things are completed in a timely manner, following up and helping ensure the process and the home are both completed correctly and to your satisfaction. A good buyers’ agent with new home construction experience is invaluable. Be sure to visit the new homes with your agent present; do not register without them, and let them know you are represented by your Realtor.

FAQs for Sellers

How much is my home worth?

The value of your home is determined by the sales of similar homes in your neighborhood or surrounding area. Another factor in its value are the upgrades and condition of your home. In most cases an owner-occupant utilizing financing will be willing to pay the most for your home and will require an appraisal. Therefore it's best to price your home inline with area values while taking into account the condition and upgrades present. In some cases such as super-high-demand locations and high-end luxury real estate cash buyers are more prevalent and may consider paying over appraised value, but it's not commonplace and shouldn't be counted on. Consult with your realtor for the best estimation of value and pricing strategy.

I want to price my home over market value so I have room for buyers to negotiate. Is this a good strategy?

It's a viable strategy, but only if you don't go too high and don't let it sit there too long if the response is less than positive. If you insist on pricing your home this way, be aware that a home is never more popular with buyers than when it first hits the market, and be prepared to reduce your price quickly if you do not receive at least three showings and some type of offer in the first week. Best-case scenario is to price it right the first time. In today's market a well-priced home often courts multiple offers.

What steps should I take to ready my home for sale?

Walk the home with your Realtor and make a punch list of items, then set about fixing them. Fresh paint and carpet are excellent ways of improving appeal and value quickly. Make sure all lights are working and have bulbs and that your heating and cooling system is functional. Check that your appliances are in good working order and consider including them in the sale when possible, as buyers appreciate turnkey homes. Eliminate any odors — food, pet or otherwise — and get rid of overly personal effects and clutter. The goal is to make the home attractive for the majority of potential buyers. Some sellers opt to conduct an inspection and or appraisal of their own beforehand to quell any value or appraisal/repair concerns on the buyer’s part. It’s hard to argue with a price if an appraiser has already stated its value, paid for by the seller or not.

Should I allow an electronic lockbox to be placed on my home and when should I show my home?

Yes and whenever possible. Of course, there are reasonable limitations to the times when a home can be shown that are unique to each household, however the more available your home is to be shown the better. Think of it as a numbers game, more showings, more chances for a contract.

Today's electronic lockboxes can only be accessed by licensed Realtors and there is an electronic tracking method to determine who has shown your home and when. If you aren't comfortable with a lockbox and want to be present for showings it is recommended to step outside at least so buyers can relax and look without feeling obligated to converse with you. Your realtor can place the lockbox on the side of the home for added privacy and discretion.

Should I consider cash or financed offers?

Consider both! Unless the home or property you are selling has structural issues, which would impede financing, consider all reasonable offers. In either case you are right to require a proof of funds statement for cash and a pre approval letter for financed buyers.

Should I offer a home warranty?

A home warranty is a very good idea. Today’s real estate climate includes many more single person households and the safety net of a home warranty from a reputable company can really help your sale.

How do I get my home seen by the most buyers and find the right buyer for my home?

Yard signs are great — where allowed of course — but in today's market social media and Internet presence are key. Pick an agent who will utilize social networks such as Facebook and Twitter, as well as search engine optimization. I like to build websites for each listing and include virtual tours with 360-degree rotatable views as well as professional photography. The more photos the better, and high-res pro-quality pictures maximized online through social media, personalized websites and SEO (search engine optimization) can fetch an owner thousands more than simply utilizing traditional marketing. Postcard mailers and print ads can be useful too if sent/placed strategically. Last but never least, word of mouth marketing by your agent to their client base and other realtors never hurts.

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