First Time Home Buyers
Question: I'm looking for my first home and want to use an agent to help me; do I have to pay for their services?
Answer: That is a common question for someone in the market for their first home and sometimes from a person who has not purchased a home for many years. The short answer is that you are not going to pay for their services as they buyer's agent's commission is a cost of the person who listed the house for sale. Some agent's may ask a buyer to sign a written agreement that the buyer will use that agent to find a home, in which case the buyer must use that agent for the transaction and if they end up buying a home without that agent they could be liable to pay the agent a commission. The reason that an agent would use that written agreement is because it is all too common for a buyer to work with an agent and look at many homes in several communities wit that agent driving them all around, only to purchase a home using another agent. Why would a buyer do that to the agent? Often because they do not understand how an agent is paid. they do not realize that the first agent, who used to drive them around, only gets paid when a deal is closed. Back to the question, a buyer is smart to use an agent in the process of looking and purchasing their home. A buyer's agent will know about the communities and the positives and negatives of the locations. The buyer's agent will be able to determine if the price is fair and at what level an offer should be submitted to the seller. You need an advocate in the negotiation process, someone who can bargain on your behalf. Once you have selected a home and completed the negotiation that same agent is your advocate for determining what repairs should be made and what inspections you should do and with what inspector. The experience of a buyer's agent makes your life much easier and can make a big difference in what you buy and where. The experience of understanding the housing inventory and what will benefit you down the road can be invaluable. You want to buy the best house for your needs in the best location at the lowest price. I can assure you that an experienced agent can provide those to you and it is well worth your time in selecting a qualified agent to work with in your home purchase journey. And of course, the commission is paid by the seller and not you... what a deal! Thanks for your questions and call me with your questions at 714-623-3543 or send me an email at [email protected] /* */
Question: I am considering purchasing a new home and would like your input on what to consider when making the purchase.
Answer: Many of the considerations are the same as buying a previously owned home. You have to qualify for the loan. The location is still a very important consideration. You want the home to match your family’s needs. When you buy a new home it is different in that you can add many upgrades at the beginning when you go to the builder’s design center and pick from the many choices available. The attraction in a new home can be the beauty of the model home, which has added many upgrades. The basic home is where you start as concerns price and that may be well in your price range. Then you start adding the upgrades you desire and the price can climb quickly and has the potential to move out of your price range. Just be careful as you select those features you want to add as the emotions may take over good financial sense. When you buy a new home you will be responsible for some, if not all, of the landscaping, which can add a substantial amount to your cost. You will be responsible for the window treatments as well. The benefits of a new home are that it is NEW, the builder may have a special financing package that lowers your loan cost, you will have builder’s warranties that could last as long as ten years on some aspects of the home. Some of the disadvantages are you may have to wait several months for the home to be ready to move in, you may have some work to do to get the yard ready and the drapes up, you may have a list of items that need to be corrected by the builder before you move in. Usually when a person purchases a pre-owned home they have the property inspected by a qualified property inspector to insure that the major systems are working properly and there are no concerning safety issues. When you purchase a new home, you should also hire a property inspector to check the home out. Since you are not a professional and might not discover a problem before you move in, the property inspector can give you piece of mind with a thorough investigation. You can take the findings to the builder for correction. I believe you are going to see more new homes being built in the next few years as the builders have not constructed as many homes during our recession due to lack of demand. But we are headed toward a housing shortage with a growing population that will require more homes to provide for the demand that is coming.