7 Steps to Home Ownership
by Tricia Ebert, Realtor®, CSA®, ABR®, BPOR®, CDPE®
Last week we discussed finding your ideal home, the one that makes you feel "in love." Now we'll deal with what to do next!
What to do when you find “the
one”: Let your Realtor know when you really like a
house. Be sure you spend enough time
looking at each room and getting a good feel for the inside and outside of the
house. Pay attention to the neighbors and their houses and how the street
looks. Do you see pride of ownership
around you? Or are some houses looking run down with lawns that need
Notice if the neighborhood is
quiet or noisy. Is there a
lot of traffic on this street? If you have a 2 year old and you want a safe
street, a busy street may not be the best location for your ideal home. Are you
near an airport? How much noise do you hear from planes taking off and landing?
If this house is freeway close, do you hear noise from the cars nearby?
Once you’re satisfied that you’ve found the house you envision
yourself living in, it’s time to take action. Your Realtor will do “comps” for
this house, looking at properties that are similar in size and location to help
you figure out the fair market value. Then you have to look at your finances
and see what the seller is asking. Most sellers price their houses above fair
market value to get the highest price possible. Depending on the market, the
final sales price could be higher or lower than what the seller wants. The bottom line for you as the buyer is to
know what your top price is and not go above it. When you decide what you
want to offer, your Realtor will write up a Purchase Offer or Purchase
Agreement which you’ll sign. She will then submit this offer to the seller’s
This is the “nail biting” part of the process. Most sellers do not
accept the first offer they receive from a buyer. It is most likely you will receive a counter-offer. In a
counter-offer, the seller will usually ask for a higher price and will
sometimes want to change some of the terms of the Agreement. Maybe you’re
asking the seller to leave their Jacuzzi, washer and dryer with the house. The
seller may agree to leave the washer and dryer but not the Jacuzzi. Or vice
When you get a counter-offer, you have to decide what’s important
to you and if you can afford to go any higher on your price. If you can’t, you
can’t. If you can match the seller’s price and you’re okay with it, you can
accept the counter-offer as is. Or you can send a counter-offer to the seller’s
counter-offer, perhaps accepting the change in terms but still offering a price
that’s less than what the seller wants.
This is why Realtors are so valuable during negotiations. The
seller’s agent and your agent can have a frank discussion about each clients’
needs. Perhaps the seller needs to net a certain amount of money from the sale
of their house because they’re retiring and buying another house in another
state to be close to their grandchildren. But you, as the buyer, also have a
financial cap on what you can afford. So Realtors can hash out what’s really
important to each party and hopefully find a middle ground where everyone is happy.
Maybe the seller will be happy to pay your closing costs, but you need to come
up $5000 on your price so that they can afford to do that for you.
So listen to your Realtor’s guidance during the negotiation
process. They are working really hard to make everyone happy, which isn’t
always an easy thing to do!
Next week: Once everyone agrees on a price and terms and your offer is accepted, you'll open escrow. We'll discuss this process next week. See you then! :-)