Education, News and Events |
| News & Events |
| Upcoming Education Classes |
Weekly Open Houses |
| Columbia Greene Northern Dutchess |
Join CGBR |
|
| Become a Member Today! | |
| Pay Dues Online | |
Helpful Tips
Accepting an Offer
- Purchase Negotiations
- Responding to Low Offers
- Know Your Price Range
- Evaluating Multiple Bids
- A Tough Sale
Agency
Buyer's Remorse
Bargain Properties
Animal House
Accepting an Offer
Purchase Negotiations
If you are selling your home, you should be prepared for the day your first offer comes in. When your real estate agent calls to say there is an offer on your home, you will naturally get excited. When your agent describes the offer, you will probably experience an adrenaline rush. Whether the offer is good or bad, you should just remain calm--and discuss a counter-offer with your agent. The negotiations of a purchase begin with the buyer's ideal terms and a counter offer that communicates the seller's ideal terms.A good agent will look beyond the price when evaluating an offer. If the buyers' financial qualifications are shaky or the offer includes potentially problematic terms or conditions, your real estate agent should be there to minimize any risk to you and to address these items in your counter-offer. Your agent's job is not to make a decision for you, but to be sure that you understand fully what the offer includes and what is expected.
Responding to Low Offers
The beginning of negotiations is usually the end of many months of hard work for the buyer or seller. The work ahead requires skill in order to maintain a strong position.Sellers can lose their advantage if they do not counter an offer that a buyer has made. Even if the opening offer is beneath what the seller feels is reasonable, it is advisable for the seller to respond with a slight reduction from the asking price. The most important component in negotiating is good communication.
The best way to handle a low offer is to counter it with definite terms that are favorable to the seller. A counter offer has two advantages: 1) it keeps the buyer interested, and 2) it moves the negotiation forward and gives the buyer the opportunity to submit another offer that the seller is more likely to prefer.
Know Your Price Range
As a homebuyer, you may have found the perfect new house for your growing family, but what if it is a little out of your price range? You might list your current home for more than it is worth and be lucky enough to find a qualified buyer who is willing to pay the price, but it is impossible to know in advance what your home will sell for.If you want to sell your home quickly, have a frank and detailed conversation with your real estate agent to determine the best price for the house. Setting your price within 5% of the fair market value of your home greatly increases your chances of getting solid offers that will result in a relatively quick sale.
Don't buy and sell so close to your target amount that you become anxious when the numbers don't meet your expectations. There may be other approaches, such as adjustable rate mortgages or owner financing, to increase your buying power and get you into that new home. When you are selling one home and buying another, you will need more than good luck. You will need a highly professional and experienced real estate agent who can give you solid advice on how to make the transaction work for your particular requirements.
Evaluating Multiple Bids
Competition for homes is high in hot markets. When you are a seller faced with multiple offers on your home, how do you choose the best one? Your real estate agent can help you compare and contrast the terms of each proposal.Look at the price of each offer and evaluate your net profit. Next, consider the terms of each contract. How "clean" is each offer? Are there contingencies that affect the sale, such as the buyers needing to sell another property before they can finalize the purchase of your home? Can you work out a mutually agreeable date for you to move out and for the buyers to move in? Can you get reasonable assurances that the buyers will be able to qualify for the financing they will need?
Your real estate agent can help you weigh the relative merits of each offer, so that you can accept--or counter--the best one, and line up another as an alternative.
A Tough Sale
Here is a situation that many buyers have experienced. After searching for weeks, you found the perfect home and you made a very low offer. The sellers responded with a counter-offer which was several thousand dollars lower than their asking price. You came back with a slightly higher bid, and they came down some more. After many days of back and forth, you finally reached a meeting of the minds, and you are very pleased with the results.If you have driven a hard bargain in purchasing a house, be sensitive to the seller's feelings as the transaction proceeds. They may be suffering from the impact of a rough negotiation. Try to minimize any additional requests you might make of the sellers. As you move toward your closing date, keep in mind that the sellers may not share your elation. If you are considerate and avoid making excessive demands, you can help everyone walk away from the transaction feeling satisfied with the outcome.
Agency
Who Pays the Commission
Does it cost the homebuyer more to be represented by a buyer's agent who serves their interests exclusively? No, because the listing agent splits the sales commission, which is customarily paid by the seller of the home, with the buyer's agent. The sales commission split is usually 50-50, but the listing agent and buyer's agent will sometimes make another agreement and split the commission unequally.There is one very unusual circumstance in which the homebuyer might pay a commission to their buyer's agent. The real estate agent might show the buyer a local "for sale by owner" (FSBO) home which the client decides to purchase. In most cases, the FSBO seller who is presented with a qualified buyer is glad to pay the buyer's agent a reduced fee of about 3 percent, or half of a normal sales commission. But the FSBO seller could stubbornly refuse to pay the buyer's agent any commission whatsoever. In that case, the buyer's agent would legitimately expect the buyer to pay the sales commission, in fair exchange for the agent finding the FSBO home and negotiating a successful transaction.
A Full Service Professional
Home sellers may be lured by the promises of agents that offer to list and sell your home for a discount commission. But consider the advantages of using a full service broker who will represent your best interests in the transaction without cutting corners.A full service real estate broker will be informed about the current trends in your local market. He or she will share valuable information about the selling price of comparable properties, to help you determine a realistic price for your home. If your home needs repair prior to listing, a reputable local contractor will be recommended. Buyers will be pre-qualified and personally escorted through your home. After showing your house, your broker will give you feedback from buyers and agents, negotiate the price and terms of the purchase contract when an offer comes in, schedule the home inspection and coordinate the closing.
You may not receive adequate professional or personal attention if the agent feels they owe you less because you are paying them less. It is to your advantage to engage the full services of a real estate broker who will give 100 percent to guide you through the complex process of selling your home.
Real Estate Agent Representation
Which party in a real estate transaction is represented by the real estate agent--the buyer or the seller? Until recently that question was never asked because the answer was always the same. Traditionally all the marketing professionals involved in real estate transactions were legally and ethically obligated to conduct business on behalf of the seller. They may have aided the buyer in certain situations, but their client was the seller. Today that is not necessarily the case.In a time of increasing specialization, buyers can be represented by a real estate agent who functions solely as a buyer's broker. In this case, the sales professional helps the buyer locate a home, negotiate the price, and is responsible to the buyer only, for an agreed-upon fee or a percentage commission.
In any real estate transaction you have the right to know which party the real estate agent is representing.
Buyer's Remorse
Patience is Required
Sellers often have to deal with a buyer's anxiety. For example, you may have reached an agreement with your buyers and signed the paperwork for the sale of your home. After all of the documents were signed, however, the buyers began to behave strangely, getting somewhat agitated and making additional demands.It is important to remember that people experience a high level of stress when they are buying a house. Your buyers may be suffering from "Buyers
Remorse"-- that intense feeling that they have paid too much and that the house is going to fall down as soon as they assume ownership. They may start questioning the fine points of the structural integrity of your home or ask you to include your new washer and dryer and power mower in the transaction.Don't take it personally if your buyers begin going through the "home-buying jitters". Be patient, and allow the real estate agent to do whatever "hand holding" is necessary to get the buyers happily settled in your home.
Buyers Remorse
If you are like most buyers who sign a purchase agreement on a new home, you will almost certainly feel a wave of overwhelming anxiety. You may begin to question your judgement -- did I pay too much? Is it the right home? Can I really afford the mortgage payments? How can I get out of it?
This response--referred to as "Buyer's Remorse"--is completely normal!Call your friends who have owned a home for a few years if you experience an attack of buyer's remorse. Are they bothered by rapidly escalating home prices? Probably not, because that means the value of their home is increasing. Did they feel anxious when they first signed the agreement?
They may tell you that they felt just as anxious as you are feeling, but now are really glad that they went through with the purchase. Have they made improvements to the property that heightened their enjoyment of the home? They will probably say they much prefer the creative freedom of being a homeowner compared with having to ask the landlord's permission to put in a garden or paint the living room.When you experience a buyer's panic attack, be strong -- you have a great deal to gain!
Real Estate Jitters
Here is a typical scenario illustrating the effects of buyer's remorse.
Your home was on the market for a few weeks, and you are now feeling fortunate because an attractive offer has been presented by qualified buyers. Once the ink dried on the contract forms, however, it seemed that everything suddenly threatened to come unraveled.Once the buyers' earnest money check cleared their account, they suddenly came up with a list of concerns that never occurred to them before the purchase agreement was signed. Their fears and demands have turned them into touchy adversaries instead of the sweet young couple looking forward to starting a family. How could the atmosphere have changed so quickly?
Buyers and sellers are both susceptible to different forms of stress reaction known in the real estate field as "Buyers' Remorse" and "Sellers'
Remorse". Fortunately, neither one of these conditions is contagious to real estate agents! An important part of our job is to help our sellers and buyers through their buying or selling jitters with understanding and humor.Closing Your House
If you are selling your house, you may have to jump through a few hoops between the time you and the buyer reach an agreement and the time the money and deed change hands. The structural inspector usually finds a few things that need to be repaired or replaced, and the termite inspection may reveal the presence of unwanted pests. Most buyers will also have a list of items that they want the seller to fix.The ideal is to have your home as perfect condition as possible in time for the walk-through inspection prior to closing. If you have agreed to complete repairs on your home, it is a good idea to get an early start on the work so there will be plenty of time to correct any "surprises" that may be found. Call several companies to get competitive bids for the work that needs to be done or ask your real estate agent for recommendations.
Presenting the buyers with a clean, well-maintained home will make the process a lot easier for them, especially if they get a case of last-minute jitters.
Bargain Properties
The Inspection Report
Are you looking for a home and becoming tired of house-hunting? If so, you may be tempted to buy a bargain-priced home "as is" and forego the home inspection. But without the inspection report, do you know what the "as it"
refers to? Wouldn't it be better to know what condition the home is in before you buy it?The inspection contingency allows the buyer to enlist the services of a licensed home inspector within three to seven days after the purchase agreement is signed. The inspector will go over the property from top to bottom, evaluating the condition of all the basic systems and structures of the home in order to identify conditions that may be considered material defects and thus may affect the market value or the safety of the home.
The inspector's report is the only documented proof of the actual condition of the property that is being sold. It is a valuable tool that helps you negotiate the sales contract and gives you information about future maintenance projects. The cost of an inspection is well worth the peace of mind it provides.
Advice From Real Estate Agents
When buying a home, it is essential to cooperate as closely as possible with your real estate agent. This can be challenging, especially if your agent asks you to do some things that you don't particularly want to do to in order to get you moved into your new home as quickly as possible.When real estate agents advise you regarding ways to make the transaction work, they are acting as part coach and part business consultant. If you find the house you love and want to "sleep on" the decision for a few days, the agent knows that you run the risk of losing the house. If you are inclined to complicate your offer with clauses that might make the contract unattractive to the sellers, the agent may ask you to consider some modifications. Should you call the week before the closing with an attack of "buyer's remorse", your agent knows the cure. Following your real estate agent's suggestions will increase your chances for a successful move!
A Home with History
A colorful history can add significantly to the value of a home.
Researching the provenance of a property you are interested in buying can be both interesting and ultimately profitable. The market value of a home will be greater if it was designed by a notable architect, built by a company with a reputation for the finest construction, or lived in by a celebrity who hosted famous guests.Ask your real estate agent if there is any historical data of significance associated with the home, or if previous owners were VIPs. Note the names associated with the deed and title to the home, and look them up with the help of the local historical society. Consult the microfiche in newspaper archives for references to colorful details of the home's past. The county assessor's office may have records of the date the home was built, and building permits may reveal the name of the architect. When inspecting the home, search closets and attics carefully for hidden historical "treasures".
Buying an older home at a bargain price, then re-selling when it is renovated and restored can be an enjoyable and lucrative adventure.
Animal House
Houses and Pets
Many real estate agents are animal lovers and have pets of our own, but we have all shared stories of having our fingers or ankles nipped by furry creatures during a showing. We have opened the front door to the home we are showing only to have a purebred Persian kitten scoot toward the nearest busy street.If you have pets and are going to put your house on the market, be sure to work out the showing arrangements carefully. It is important for us to be able to communicate to our colleagues what to expect when they pass through your front door. It is rare for pets to pose significant problems, but big dogs can be menacing. Buyers or agents may be allergic or even a little phobic about dogs or cats.
It is difficult to get a buyer excited about your home if he or she is sneezing continuously or unwilling to cross the threshold because your dog is barking away intruders. If your agent knows there might be a problem, they can arrange ahead of time for you to walk the dog, vacuum the cat dander or do whatever is necessary to make sure that the showing goes smoothly.
House Odors and Selling
Do you have a dog or cat that lives indoors with the family? A pet can pose a problem when your property is listed for sale. Even if prospective buyers have pets of their own that smell just like yours, they may be repelled by animal odors as they tour your home. If you have a pet odor problem, you should hire a professional to clean and deodorize the furniture and/or carpets that have been affected. Check the cat box frequently and keep the kitty litter fresh.Some people have allergies to pet hair or irrational fears of certain animals, so it is a good idea to put dogs or cats outside or confine them to one area when your house is being shown. It is hard for buyers to appreciate your home through puffy, watery eyes or in between sneezes! Even if the house is exactly what they want, your chances of selling it will be diminished if the buyers are afraid of being attacked by Fido.
Columbia-Greene Board of REALTORS® | 337 Fairview Avenue | Hudson, New York 12534 | (518) 828-7871 | FAX: (518) 828-6899 |
