Getting the Best Deal on a Home

Written by Posted On Sunday, 15 January 2006 16:00

Buying a home is very often an emotional process especially if it's going to be your primary residence. Every buyer wants a good deal, but as one California agent told me, they'd like to find money on trees too! Well, buyers, fear not -- you don't have to start searching for that money tree to buy your next home. Just make sure you review these helpful tips before you make your next offer on a house. It could give you an advantage over another buyer in the market.

Determine true market size

There may be plenty of homes in a particular area where you are house hunting, but that doesn't mean that they'll all be suitable for your needs. Identifying how many homes actually could be right for you will help to determine your negotiating power. Choices are always critical to creating a better deal.

"If there are only two homes that meet your needs then it may not be possible to negotiate the best possible offer," says George Mantor President and CEO of The Associates Financial Group in Carlsbad, California.

Look for vacant properties

Finding properties that are vacant is a good opportunity to get a deal. Very often sellers might have moved out because they purchased another home and they don't want to now have to carry two mortgages. The longer vacant homes sit on the market, often the more eager and motivated the sellers become to begin negotiating with buyers.

Look for the diamond in the rough

Have you ever been shown a house and your first thought was, "This is awful. Who would ever live here?" The home sells; the new owner makes a few changes to it and puts it back on the market. You go see it again and it feels completely different -- now it's charming and pleasant. This is the diamond-in-the-rough scenario. A lot of buyers will pass up a good buy on a home because they can't see its potential.

Real estate agent, Tim Finn of Keller Williams Realty in Woodland Hills, California saw how his savvy clients got the upper hand because they could envision how the home would look after a little work was done to it.

"The property was really nicely redone by somebody five years ago but the man living there hadn't really done a thing since and he kept a lot of cats there -- it smelled really bad. [My buyers] were willing to overlook that. They knew that once the cats were out of there and the place was cleaned up it would smell fine, so they got a good buy," says Finn.

Look at schools in the area

You may not have kids but you'll still want to look at the school districts where you are planning to buy your home. This can be a good bargaining chip with the seller. "If the schools are really, really great it re-affirms that there is underlying value in the property. If the schools aren't so great then maybe it's a negotiating point," says Mantor.

Be willing to visit difficult-to-show properties

Some houses that are considered good buys on the market are the ones that frequently aren't easy to show. Whether it's because a tenant is living there and won't cooperate, the seller has refused to allow a lockbox to be put on the home or the showing hours are extremely limited -- regardless of the reason, this is a home you should see. Why? Because many agents and buyers won't bother with the home as it is too difficult to show. If you have a home for sale with minimal showings, then there are likely very few, if any, offers. It's the perfect opportunity to bait a seller by putting in an offer.

Remember, though, you have to be patient with these types of homes and you have to let your agent know that you're willing to take the risks that go along with seeing difficult homes to show. "Typically if I take [a buyer] out to a property and we get stood up by the tenant, that reflects badly on me and I may lose that buyer. But if that buyer has told me 'look, Tim, don't worry about these kinds of things,' then I have permission to attack those sorts of problems and they can result in a very good buy," says Finn.

Be flexible with your closing date

There are lots of reasons why sellers have to close escrow by a certain date. They may be trying to move to get their children into another school or they may have a job lined up somewhere else -- whatever the reason, if you can match your closing date with the seller's you might get the best deal on the house. Make sure you know when the seller wants to be out of the house before you put in an offer and then do your best to meet the seller's closing date.

Shy away from price-per-square-foot method

This method only determines the square footage of a home, but it leaves out upgrades such as recently-remodeled kitchens or bathrooms. It also doesn't take into account homes that have views or are located on very busy streets. It gives you an idea of what you're paying per square foot, but other details about the home may be the reason it is priced higher or lower than a home in the neighborhood with similar square footage.

"It isn't just the price. It's really how close does this particular thing come to providing you the satisfaction that you would get by virtue of the fact that it meets more of your needs," says Mantor.

If you can keep your emotions in check, practice patience and follow the tips in this column, you'll find you're in a better position to get the best deal on your next home.

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Phoebe Chongchua

Phoebe Chongchua is an award-winning journalist, an author, customer service trainer/speaker, and founder of Setting the Service Standard, a customer service training and consulting program offered by Live Fit Enterprises (LFE) based in San Diego, California. She is the publisher of Live Fit Magazine, an online publication that features information on real estate/finance, physical fitness, travel, and philanthropy. Her company, LFE, specializes in media services including marketing, PR, writing, commercials, corporate videos, customer service training, and keynotes & seminars. Visit her magazine website: www.LiveFitMagazine.com.

Phoebe's articles, feature stories, and columns appear in various publications including The Coast News, Del Mar Village Voice, Rancho Santa Fe Review, and Today's Local News in San Diego, as well as numerous Internet sites. She holds a California real estate license. Phoebe worked for KGTV/10News in San Diego as a Newscaster, Reporter and Community Affairs Specialist for more than a decade. Phoebe's writing is also featured in Donald Trump's book: The Best Real Estate Advice I Ever Received and The Complete Idiot’s Guide to Buying Foreclosures. She is the author of If the Trash Stinks, TAKE IT OUT! 14 Worriless Principles for Your Success.

Contact Phoebe at (858) 259-3646 or phoebe@livefitmagazine.com. Visit PhoebeChongchua.com for more information.

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