Shattering Some Misconceptions about Homebuying

By on 27 October, 2014 in Real Estate, Sandra Nickel with 0 Comments

It’s fascinating to me how stuff gets passed off from person to person “as the Gospel truth.” And fictions about the homebuying process are among the most widely spread mis-truths going around today. So if you — or someone you care about — is thinking about buying a home this fall, listen up!

Misconception: If you pay list price, you’re paying too much.

If you don’t know what the current market value is for homes in the area and whether the market is appreciating or depreciating, you don’t know what a fair price is and you’re likely to miss out on a great deal by trying to low ball a house that’s already priced well.

If the house meets your goals, is within your budget, and is priced competitively, it’s a bargain and you should make a strong offer. Get assistance from a professional to help you recognize a good deal and grab it before it’s gone.

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Misconception: Foreclosures and short sales are the best buys.

Many buyers find out the hard way that foreclosures and short sales are full of headaches, may need extensive repairs, require great patience over an extended period, often don’t have the criteria that’s most important to you, and may never close.

Short sales abound in Montgomery (I should know — I represent a lot of them). And many people are now starting to avoid them because the pain isn’t worth the gain. You can wait for months and months on your short sale offer, only to have some out-of-town and out-of-touch lender come back with a price even higher than what the seller had been asking!

Foreclosures can be less troublesome, but are often in poor condition with challenges that may take longer than normal to resolve. There are a lot of investors who will pay cash and forgo inspections, so you may find yourself on the losing end of multiple buying attempts. Market prices have begun to correct in many places, including Montgomery, and it’s still possible to find great deals in homes that are priced like short sales, but don’t have the headaches. How do you ferret them out? Get a good agent to be on the hunt for you.

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Misconception: You get a better price if you buy directly from the owner.

Bargain hunters sometimes avoid Realtors, thinking that they will get a better price if they buy directly from a FSBO (for sale by owner). Meanwhile, the sellers are also trying to save on the commission, so they’re not getting expert advice either and often price their homes above market value.

The end result is often that a buyer pays too much or the FSBO is unable to get the house sold. A savvy Realtor working on the buyer’s behalf, armed with market data and great negotiation skills, is much more likely to get a great deal than buyers can by negotiating for themselves.

Bottom Line: If you’re buying a house, it’s a great idea to find a good Realtor and listen to their advice. Don’t know anyone? We can help.

Sandra Nickel has been listing and selling residential real estate for over 30 years, most with an intense focus on Montgomery’s Midtown neighborhoods. Sandra serves on the Mid-Alabama Coalition for the Homeless, the Cloverdale Business Coalition, Historic Southview, the Volunteer and Information Center, Landmarks Foundation and her own neighborhood Garden District Preservation Association.

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