buy·er ˈbī(ə)r/ noun.
a person who makes a purchase.
synonyms: confused, intimidated, on edge, occasionally dishevelled.
antonyms: gambler, shooting in the dark, takes what he/she can get.
Contemporary example: “You’ve decided to buy a house, what’s next?” You’ve heard all the horror stories and they all have a similar tale to tell: a current market that holds nothing but disappointment and despair with plot twists like multiple offers, unethical agents, and inflated prices. However, buying a house, even in the current market, is not about surrendering to the forces of real estate and taking what you can get. As a responsible buyer you can walk away content if you follow these 3 steps:
- Find a Realtor You Can Trust
Working with a professional who buys and sells real estate on a regular basis is of the utmost importance. Sure, we all know Aunt Sally who has promised low/no commission on your deal. But Aunt Sally hasn’t sold a house in years! She is well meaning but she is not equipped to position you effectively in a fast-paced and competitive market. There are plenty of capable realtors out there so find your realtor soulmate — someone you can relate to and have an honest working relationship with. Where do you start? Ask friends for referrals, or visit some open houses and go on impromptu “speed dates” with the agents. Afterwards, interview your top choices, ask them hard questions, get their history, and then take a leap of faith.
- Get Your Finances in Order
Review your finances and find out what your limits are … then stay within them.
Get to know the types of products that will help you get the house you want; mortgage options, interest rates etc. Again, find a professional with a good understanding of their industry who will not only advise you, but will shop around to find the best possible product to fit your needs and financial situation. Once you’ve found what you want, don’t just walk into a bank and sign the first mortgage you’re offered. Your mortgage is going to be your biggest expense, and you’ll be paying it long term. Find someone who will help set you on the right financial path for you and your family.
- Educate Yourself
Contrary to the slightly dramatized stories you might hear, real estate is not a game in which you are a player or a gambler who is bidding to win the prize. You don’t go to auction hoping to win, you strategize based on facts and information. First things first — know your market. Get out there and see what’s available in the areas where you want to be. Know the differences in price between semi-detached and detached homes, 2-Bdrm and 3-Bdrm homes, homes with powder rooms, parking garages, etc. Learn the numbers and figure out where you fit within that sliding scale. Don’t be fooled by list prices; they’re often just an advertisement or more of a guide. A good realtor will direct you to see the houses you can buy once the dust settles, not the ones that are listed in your budget.
Now you are prepared, educated, and confident that you know your limits. By completing these 3 steps you have positioned yourself to truly understand what you are buying. You know the value of the home you will make an offer on and you know what you are willing to spend on it. You also know what you’re willing to lose that home for; you are not playing a game nervously with money you don’t have. You are in the right place, with the right knowledge, and with the right odds that you’ll soon find yourself on the inside of that home looking out at your new neighborhood.