You’ve been to 3 or 4 open houses. After much debate about which property you liked and why, it is time to make the first offer on the property! How do you know what to offer? Should you ask for closing costs? What about getting pre-approved? Those are some of the things you should consider and we’ve listed out a couple more below. Remember working with a professional real estate agent is the way to go. They could go through the buying and selling process in their sleep and will be able to guide you through it and help you with any obstacles that come along.
Home inspection
A home inspection is a commonly missed procedure in the home buying process. We see it happen in older and newer homes. It is very important to know if the inspection went well or not. If it didn’t go well, what are the areas where work still needs to be done? You can make your first offer contingent to a successful home inspection. If you are working with an agent, they will help you in this area of negotiations while also getting you the best price for the property.
How much were you pre-approved for?
Here is another option where you can make your first offer contingent on getting pre-approved. It is pretty sound advice to visit three or four banks and get pre-approved for the amount you want to buy the home for. It is very important you don’t do anything with your credit at this stage. Do not go buy a car, apply for a credit card, or even buy the appliances for your new home. Those are all things you should wait to do until after you close on the property.
Do you want the seller to cover the closing costs?
Asking the seller to cover closing cost has become more acceptable and ideal within the buying process. This is something you can leverage with if the seller won’t move the price or the home inspection didn’t come back clean. Either way working with an agent is the best when negotiating your first offer!
How flexible is the seller on the asking price?
When a property is priced properly according to the market, it is not uncommon to see a house go for what it is listed for. Sellers who are motivated will be the most flexible, though. This can occur if the seller is relocating and needs to leave asap or if the house spent a lot of time on the market. It is important to work with an agent. You do not want to make your first offer too low and force the seller to walk away.
Validate your offer
Tell the seller why your offer is what it is. Does the home match what you are looking for? What are some things you found in the home inspection that were not expected? You cannot make a lower offer just because you don’t like the paint on the walls. When validating your offer just be honest, but do keep in mind the feelings of the seller and remember to stay respectful, and not be harsh. It isn’t uncommon for sellers to have lived on a property for so long that they might be unaware of issues, and could even be willing to fix them prior to you buying the property.
Check the utilities
Check with the homeowner and ask what is the range of monthly utility costs. Remember you are not paying only a mortgage. You will still need to budget for electric, water, and gas/propane.
Conclusion
It doesn’t matter if you are buying a home for the first time or the fourth time! The most important thing about buying a home is being prepared, being educated on the property you are buying, and working with a professional real estate agent to help make the process go smoothly!