What’s up, fam, we are here. Back with 12 tips that every first time homebuyer needs to know that you probably haven’t heard before. Let’s go and get into it.
Number One. Refrain from making commentary about the home while you’re touring it, because homeowners could be eavesdropping via smart home technology or like a nanny cam. This totally happened to me and a client one time. Actually, it was my listing. My seller calls me, says, hey, I really think they like the house. I know that they’re going to put in an offer.
And I was like, how do you know? He’s like, oh, it’s on my ring doorbell. I heard the whole thing. I was like, oh, my gosh, yes. That’s a thing guys, enter a whole discussion about how it’s illegal to record people without them knowing that that was a fun conversation to have with our own client. So sorry about that, Mr. Buyer. Whoever was taking advantage of however, valuable lesson learned, right? Yeah. Wait till you’re outside and maybe like not even at the property. Wait till you’re in your car or at the next property before you get into those deep conversations with your family or with your broker, because it’s in your best interest.
Number 2. talk to the neighbors before buying. So a couple thoughts here. Make sure you talk to several neighbors. Sometimes neighbors have a feud with a seller. And we’ve run into situations where that neighbor just wanted to do everything they could to exact some sort of revenge for some sort of dispute they had and they would talk crap about the house. So that’s why I say absolutely talk to neighbors, but talk to like three or four neighbors, because if you talk to like the one neighbor next door, you might get a bit of advice. That’s not necessarily accurate. However, it is definitely good intelligence to have to talk to the neighbors, see what it’s like, what’s it like at night time? Are there kids in the neighborhood just get a real vibe and neighbors are pretty apt to open up if they know that you’re going to be a potential neighbor of theirs. So don’t be afraid to knock on some doors and get a feel and a vibe for the people that do live around you. They’re probably going to give you a really good scoop if a home beats eighty five percent of their crime is you’re looking for, make an offer. Yeah, that’s a good one, especially right now, and particularly for home for first time homebuyers buyers.
Number 3. Your budget, normally first time homebuyer budgets are at a certain point where you’re not necessarily buying your dream home. This is getting your foot in the door into home ownership. You’re looking to get out of renting and into ownership, build some equity. So normally we recommend eighty eighty five percent, like if you can see yourself living there. And there’s a few major features about the home buyer, things that you can appreciate. You probably want to move forward with it, particularly in this market. It’s very competitive and most homes are going under contract, above list price. So if you like it, I’d say hop on it. What do you think? Definitely. Yeah. You agree? Yeah.
Number 4. Keep a keep a f##er face. She said keep a f###er face. Dude you have to keep that. keep a poker face while you’re touring at home. If you seem too enthusiastic, then you may lose some of your negotiating power. It’s it’s true. And it’s like really good tactical strategic advice, because there are a lot of people out there that only see real estate transactions from like a win lose perspective. And they’re out to get every dollar that they can. We do our best when representing buyers to create some empathy and create like a win win scenario. But you definitely don’t want to give away a card that you don’t have to use to play it cool wait until you’re to the next house before you really like let those emotions out if you’re excited about it. Just stuff them back down for a couple more minutes and hit the road later. Do a happy dance later. Yeah, absolutely.
Number 5. Do not skip your home inspection and ask for seller concessions to help compensate for imperfection. Now, seriously, we’re seeing this a lot right now in the market where buyers are completely waiving the home inspection all together just to make their offer look better for a seller. Yes, it makes the offer look better for a seller ,but it is not in your best interest, especially if your first home buyer, you should know the home or at least get a report about that home before you purchase it. Even if you’re not going to ask for any repairs from the seller, at least get that information that will help empower you and know what you’re getting into and what you have in the house for down the road. Yeah, I totally agree. There’s essentially two instances where it would make sense from a strategic perspective. To waive a home inspection is number one, if you’re cash heavy. So if you’re in a strong cash position and you’re not afraid of something that you don’t know in the home. you’re just like, cool, I got it. I’ll stroke a check for it. OK, understood. Number two would be if you’ve owned a home several times before and you probably I mean, if you’ve owned four or five homes, you probably know almost as much as a home inspector because you’ve seen everything there is to see in a home. So if you have a lot of experience, that makes sense. But if you’re a first time home buyer and you’re just kind of doing your best to get in the home and you don’t have a bunch of money set in the bank, do not waive your home inspection, it’s too risky.
Number 6. When you’re interviewing real estate agents and brokers, do not shy away from an agent who is willing to have a hard conversation with you. And what I mean by that is it’s really easy for someone to tell you what you really want to hear and make you feel really good, warm and fuzzy and choose that agent. Now, a good agent will still make you feel warm and fuzzy and comfortable and confident that they know what they’re doing and they’re going to protect you. However, if. Your agent is so weak that they can’t tell you the real scoop, that agent is also going to get outplayed by a strong agent during negotiations, and they won’t know how to look out for your best interests. The reality is, so many agents today, over 50 percent of agents today are still part time, which means they don’t do enough business to get really good at this because repetition breeds excellence and expertize.
Number 7. So if you’re sitting down with an agent and they’re telling you things that might be new information or might be like a little uncomfortable, but they’re really doing this for your economic best interests, then don’t necessarily cut them off just because it was a little uncomfortable. The likelihood is they’re telling you things that you don’t want to hear to get you prepared for what can at times be a stressful in a financially involved journey. So you want someone that’s strong on your behalf so they can be strong when they’re out there negotiating. They tell you a lot about how well the property has been cared for and its condition. Yeah, that’s good. The only caveat on that is like old school oak floors, because they can be a little soft. And if they have kids or dogs, you know, our little rugrats definitely tore up some wood floors in their day. So it’s not a hard and fast rule, but it is something to consider to make sure you’re checking out the floors because it can clue you in to how well they have maintained the rest of the home.
Number 8. don’t get too overly attached to one listing particularly. While, we’re in a seller’s market. You most definitely should have like two or three options for your own sake. So crazy disappointment doesn’t set in if you don’t get the first house on your list. So give yourself a couple of options. Take a little pressure off and make sure again, back to the 80 percent rule. As long as you’re hitting most of your major criteria, you’re going to be fine. You don’t judge at home in the first six months that you bought it. You judge it over four or five, six years based on the equity that you built up and based on the experiences that you and your family have, their memories you have there. Yeah, I threw that in there. It’s not all about money. I know. It’s mostly about money and memories. M&M.
Number 9, your real estate agent is going to want you to have a preapproval letter from your lender or a prequalification letter. It sets you apart from the looky loos who aren’t really serious about buying a home when making an offer. Yeah, for sure. And the difference between a prequalification and a preapproval preapproval is sort of a more rigorous financial litmus test. Right. Whereas a prequel just basically says they checked your credit and you’ve told them what their income is. So if you want to be a little more serious, go as far as getting a preapproval before you’re looking and sending offers.
Number 10. Don’t use the bathroom at open houses like it seems self-explanatory. But in more than one instance, we’ve had a client that just rolls up on the bathroom and drops one, like, don’t do that. An emergency is a different situation. But, you know, have some people set up their houses, they have snacks out, they have music playing. The doors are open, the lights are on. There’s guests, neighbors and family coming through. They have champagne and wine. Don’t just go drop a big hairy one in their toilet. It’s just not cool man, it’s not cool.
Number 11, an escalation clause can help you win the bidding war without going over your budget. So what does an escalation clause? Escalation clause is an offer that has incremental increases that can go above and beyond a competing offer.So let’s say you’re buying a house for two hundred and fifty thousand dollars, but you’re willing to go up to two hundred and sixty thousand dollars. You can put in an escalation clause to make it go up to two hundred and fifty one thousand two hundred fifty two thousand in increments. So you can outbid any other buyer and you can cap it at whatever number you want to cap it at so they don’t just take you to the top of what you’re willing to pay. And we can actually ask as your representative, we can actually ask to see evidence of a competing offer so that you don’t get taken advantage of.
Number 12 in a sizzling hot market, it’s a buyer’s letter, can appeal to a seller, write a letter to the seller, telling you, telling them how much you love this home. Just don’t mention the remodels you’re going to choose to do after you move in. You know, just make sure they know how much you love the home and it’ll give them some Warm and Fuzzy’s and they might just pick your offer. I’m thinking like I can’t wait to rip out little Susie’s closet and make a game room out of it. Yeah, don’t do that. Bad idea.
I’m Jonathan. This is Rachel. We are that fit team, professionals in real estate and passionate about people. We would love to work with you. See you soon.