6 Little White Lies That Can Help You Buy a House

When you find a home you’re dying to own, you might assume that honesty is the best policy when dealing with the seller (or the listing agent). And it is … to a point. But keep in mind, buying a home is a high-stakes poker game—er, negotiation—where revealing exactly what’s going on in your head, heart, and bank account could cost you big-time.

Of course, you should never outright lie when you’re trying to buy a house. We’re on the record on that point, right? Good! But all that said, you might need to tiptoe around the truth sometimes.

So before you say something you’ll regret, here’s what info to gently spin so the ball stays in your court.

White lie No. 1: ‘I’d ideally like to move in by X date’

What you really mean: “I have to be out of my current place by X date! Help!”

Recently Bob Gordon, a Realtor® with Berkshire Hathaway in Boulder, CO, walked through an open house with a client who fell in love with the charming home—and excitedly approached the listing agent, announcing she was going to make an offer. Oh, and she had to be out of her current home in 30 days.

“That’s when I jumped in and took my client outside,” Gordon notes. The lesson he drove home to his client (and wants to pass on to others) is that if you absolutely have to move by a certain date, sellers will smell your desperation and play hardball. So it’s better to soft-pedal this info and pray they’re eager to move out quickly, too (as many sellers are).

White lie No. 2: ‘We’ve made every effort to get our finances in order’

What you really mean: “God, we hope we can afford this.”

You don’t want a seller to worry that your contract will fall through, so keep all money concerns (like fears about loan denials) to yourself.

“Most of these issues can be covered by generic financing contingencies,” assures Kyle Alfriend, managing partner for Alfriend Real Estate Group Re/Max Achievers in Dublin, OH. If not, you should probably wait to make an offer until your issues are resolved.

White lie No. 3: ‘We’re really excited about this house’

What you really mean:  “We must have this house! Seriously, we’ll do anything.”

Of course, homeowners will be flattered to know you love their home, but for your wallet’s sake, you need to play it cool, says Paul Silverman, a broker associate for Martha Turner Sotheby’s International Realty Circle of Excellence in Houston. “If sellers know that you’re absolutely in love with the home, they might not be as willing to negotiate.”

White lie No. 4: ‘We’re not sure yet what our top offer will be’

What you really mean: “The most we can possibly pay is ___.”

“You shouldn’t let the seller or seller’s agent know what you’re willing to pay, no matter how much you want the house,” advises Laura Usher, president of Cape Cod & Islands Association of Realtors and a Realtor for Kinlin Grover Real Estate in Brewster, MA. “Negotiation is part of the strategy in the home-buying process. It’s important not to show your hand.”

White lie No. 5: ‘We’re guessing there are other houses that also offer what we want’

What you really mean: “This is the only house that has the price point/pool/school district we want. Period.”

“Sellers must price their homes against the competition, and this is the greatest tool the buyer has,” says Alfriend. Because of that, try not to gush like a schoolgirl with a crush about any features that make the home unique.

Even “if this is the only home in your price point with a pool, walking distance to a school, three-car garage, or five bedrooms,” Alfriend says, “don’t let the sellers know that these are critical to your purchase decision.” If you do, they’ll know they have the upper hand.

White lie No. 6: ‘We have a few more questions’

What you really mean: “We’re getting cold feet.”

Freaking out a little about your decision? Please don’t express your jitters to the home sellers. Feeling nervous is entirely normal—or a sign that you should ask more questions to clear up any concerns.

For instance, if you’re wary of whether the pool and yard will require too much upkeep, go ahead and ask the sellers how many hours they spend on maintenance (or what they pay someone to do it for them). Or if you’re leery about neighborhood safety or wonder if there’s good access to public transit, there are plenty of ways to research the area online and get more info. Or, if you’ve truly got a case of cold feet, you may just need a reality check from a trusted friend or your real estate agent about how, say, you’ve looked at plenty of homes to make the right decision. But this sounding board should not be the home seller—unless you want some major drama on your hands.

Source: Realtor.com, Stephanie Booth
http://www.realtor.com/advice/buy/white-lies-that-can-help-you-buy-a-house/?iid=rdc_news_hp_carousel_theLatest

Why Being Outbid on a Home May Sometimes Be a Great Thing

It’s no secret that signing over your life savings to buy a home is stressful. But these days, when aspiring owners battle it out over an ever shallower pool of available properties with ever bigger, bank account–busting offers, it can be nervous-breakdown-inducingly stressful.

So it may be time for a bit of recalibration. The modern-day reality: It isn’t the end of the world if you’re outbid by an offer you couldn’t afford to match. In fact, you might want to thank your lucky stars that you didn’t blow your budget. (And your savings account may want to thank you, too.)

“Get over the fear of rejection,” HGTV star Scott McGillivray said in an interview for the financial podcast “So Money.” “If your offers are not being rejected, you’re possibly offering too much.

“Nine out of 10 offers that I put in get either turned down or sent back to me,” the “Income Property” host said in the podcast.

So instead of digging themselves into a financial hole, shoppers should figure out their budget before they begin to scour online listings, visit open houses, and fall in love with a property they can’t afford, says Greg McBride, chief financial analyst at Bankrate.com, a personal finance website.

In tough markets, they may even want to lower their price threshold so they have room to up their offers, he says.

“People tend to stretch to the limits when buying a house anyway,” he says. “A bidding war only stretches them even further.”

Those who don’t have the cash—or stomach—for bidding wars may need to make some trade-offs, says Denver real estate agent Kristal Kraft of the Berkshire Group.

They can consider older homes and those in need of a little TLC (and are therefore priced to move), or broaden their search area to cheaper neighborhoods.

A little backup doesn’t hurt either. Buyers should always discuss their can’t-go-even-a-penny-higher walk-away points with their real estate agents before they even submit an offer, says San Diego–area agent Seth O’Byrne. That way there’s a check against them getting swept up in a no-holds-barred bidding war.

“It’s very easy to get overheated or overexcited,” says O’Byrne, president of the O’Byrne Team, a Pacific Sotheby’s International Realty affiliate in La Jolla, CA. “But when the dust settles, all that matters is what the property is actually worth and what you paid.”

Source: Realtor.com, Clare Trapasso
http://www.realtor.com/advice/buy/why-outbid-can-be-good/?iid=rdc_news_hp_carousel_theLatest

8 TIPS FOR GETTING THE NEW HOME YOU WANT IN A COMPETITIVE MARKET

Late last year, eager homebuyers lined up overnight at a new-home community in the Dallas suburb of McKinney, TX to get first crack at a new phase release. Shades of pre-recession days when campouts for new homes were common? In the mid 2000s, we bought a new home in a popular California suburb that became so in-demand, the builder started splitting phases in half to accommodate larger price increases per phase. The homes that sold at the tail end of the community were $150,000 more than those purchased in the first phase.

Are we headed there? Maybe not. There have been a sprinkling of campouts over the last couple years as the real estate market continues to improves and inventory shrinks, like here and here. In the case of that McKinney community, Prestwyck, competition among all homes in the city and surrounding suburbs is steep.

Line up, and you only have to worry about the people in front of you, unlike the increasingly hostile environment of existing home purchases in popular areas - especially when all-cash buyers are shutting out those who have the nerve to need a 30-year mortgage. So how do you make sure you get the new home you want?

1. Be informed

If you have specific neighborhoods, communities, or builders you're interested in, start researching and following them on social media, and set up Google alerts. The first line of defense is to know what's going on so you can act fast to get the home you want.

2. Register your name on the interest list

Communities and builders reach out to those on their interest lists with news about model homes, property releases, new phases, and other updates. If you want to be among the first to know, make sure the community/builder knows about you. You also want to be aware that many new-home communities have a policy regarding real estate agent representation; you typically have to tour the community with your real estate agent on your first visit in order for your agent to receive a commission when you purchase. Which brings us to our next tip…

3. Work with a REALTOR®

REALTORS® have the inside track on new releases and in many cases will be able to alert you to important news before the public has been made aware.

4. Make a friend

It doesn't hurt to makes friends with the sales agents in the community. They're great resources for neighborhood details others might not be aware of.

5. Get preapproved

If you're not preapproved for a loan when you go to buy a new home, you could lose it to someone who is.

6. Check for financing options through the builder

Using a builder's in-house mortgage option won't move you up an interest list, but it can provide other benefits. Depending on the builder, there may be incentives like closing cost help or upgrades for financing your home with their mortgage partner.

7. Talk to your REALTOR® about options and upgrades

This is important when securing your financing. The model home, if there is one, will likely be significantly upgraded and full of options that raise the price well beyond the base price. Having an idea of the options and upgrades you want, and the cost involved, is an important step in the process because it helps ensure you are approved for the correct amount. Finding out after the fact that you can't qualify for the home you want because the decked-out kitchen you're coveting has pushed the sales price out of reach would be a drag.

8. Familiarize yourself with the community and the properties

Intense community interest - the kind that incites campouts - can breed a frenzied energy and cloud judgment. And, you never know which homesites the people in front of you in line will choose. It could be that the one you were dreaming of is gone by the time you get to the front. Knowing the community well and having notes outlining which sites meet your needs will help you make an informed choice when it's your turn.

Source: RealtyTimes, Jaymi Naciri
http://realtytimes.com/consumeradvice/buyersadvice1/item/42747-20160303-8-tips-for-getting-the-new-home-you-want-in-a-competitive-market

What to Do If You Get an Offer ... But Your Home Isn't for Sale

It’s the knock on the door that comes out of left field. Or the unexpected envelope in the mail. A stranger says he wants to buy your house, and for a great price.

Or what’s even more common is that a friend of a friend or acquaintance approaches you about her desire to purchase your home.

What should you do when you receive an offer from a buyer when your home isn’t even on the market? It happens more than you would think, and it’s helpful to consider your options, whether you’ve thought about selling or not.

Why does this happen?

While you go about your day-to-day business and enjoy your home, able-and-ready buyers are desperate to be homeowners. In many parts of the country, inventory for homes is still at all-time lows.

Quite frankly, there just aren’t enough options for buyers, so they have to think outside the box.  Some aggressive buyers take matters into their own hands, mailing letters to homes in their desired neighborhoods and hoping for a winner.

What do you do?

If you have no desire whatsoever to sell your home, do nothing. But some homeowners will want to hear what the buyers have to say, while others might seriously consider an off-market offer.

Your first step is simply to listen. You’ll want to vet the prospective buyer over the phone to make sure they’re serious.

Ask how long they’ve been looking, if they’ve made other offers already, and what their desired areas are.

Then ask them why they chose your home. A buyer who mails an offer to you and only you probably really wants your home, as opposed to those buyers sending postcards to 50 people.

Hear them out and better understand their motivations, experience in the market, and possible price or terms, if any.

You will likely need to show them the home. If they seem serious, take that step, but be cautious letting a stranger into your home.

Enlisting a real estate agent

If you used the help of an excellent local agent when you purchased your home, you might want to re-engage them at some point.

While buyers and sellers dream of consummating a deal and saving money on real estate commissions, it’s often a better strategy to consult with an honest and experienced agent. A good agent looks out for the long-term relationship, and being an adviser to an off-market sale is in their best interest as well.

Many agents will assist in an off-market deal for a reduced commission, since they don’t have to prepare and show the home for weeks or months.

Off-market deals may not pan out

These deals don’t always come to fruition for a variety of reasons — frequently, it’s because the seller isn’t motivated enough to let the property go.

And in nearly every off-market deal, there’s a struggle over the last few thousand dollars — and that conflict often keeps the sale from happening.

The buyer wants a discount, because they know the seller isn’t paying a real estate commission. The seller wants their market value because the home is worth what the home is worth. Both parties wish to benefit from the commission savings.

In most cases, if the buyer wants to buy, they need to pony up. The seller has what they want, and purchasing off the market is, in some ways, an opportunity they need to pay for.

Source: Zillow Blog, Brendon Desimone
http://www.zillow.com/blog/what-if-you-get-an-off-market-offer-191158/

First-Time Home Buyer's Guide to Making an Offer

After months, maybe even years, of looking at homes online, going to open houses and stalking listing data, the time has come. You’ve fallen for a home, and you’re ready to make your first offer. It can be scary, but it’s exciting at the same time.

Here are some pointers to keep in mind as you throw your home-buying hat in the ring for the first time.

Have confidence in your search experience

Keep in mind that when it comes to making an offer, there is no single right answer and no “exact” price or terms for a home you covet. As a savvy buyer, you’ve got the market knowledge and experience it takes to analyze the deal. Believe in yourself.

Take what you’ve learned, partner with a great agent, and trust your judgment. Think about the homes you’ve toured and open houses you’ve attended, and you will naturally start to see where your home of choice fits in the context of the market.

Learn all you can before deciding on your offer

If you are ready to pull the trigger, first find out what the story is with the listing. In order to come up with the best offer, you’ll need to know how long the home has been on the market, if there are other offers on the table currently, and if there’s a specific day the sellers will review the offers.

You can uncover a lot by learning about the seller. Find out why they’re selling and what their motivations are. Pull all that information together and then mesh it with comparable homes’ sales data.

Reviewing comps is crucial

Your agent should send you the last six months of recent sales data to review and compare. These “comps” tell about the most recent market and what current buyers/sellers have agreed on for a sale price.

Look at the pending sales first and see if your agent can uncover some information about those transactions. You want to ask about the number of offers they received or a ballpark selling price. The pending sales represent the most up-to-date market statistics. Ask your agent what his opinion of the home’s value is and start to mull over this information.

Give your lender a heads up

Your lender should be on speed dial at this point. Let her know you plan to make an offer on the home. Not only will you need a pre-approval letter with your offer, but you will want an update on mortgage rates and products, since these change daily.

From the time you applied for pre-approval until now, there could have been a massive shift in rates or a new product that could benefit you. For all you know, you can afford more, or that bonus you received last month could mean a higher down payment and qualifying for a better product.

Discuss terms

In addition to price, you will need to decide on terms. How long will you take for your inspections? Do you want to close quickly or take a longer time? Will you need an appraisal and loan contingency? How long should that be?

The terms of your offer can make or break your deal. If the seller wants a quick close, and you can do it, give it to them. If you are competing with a cash offer, make your loan terms foolproof. Marry all of the data from above and take your best shot.

Remember, there will be other houses

Rarely does a buyer score the first house they offer on. And it’s not the end of the world if you don’t. There will be other homes for sale.

People change jobs, get divorced, move closer to family, have children or pass away. All of these things can result in a home sale or purchase.

Have faith that another home will come along in the future. There’s no rush, and you should never buy real estate overnight. Have fun, and learn from each offer you make.

Source: Zillow Blog, Brendon Desimone
http://www.zillow.com/blog/guide-to-making-a-home-offer-182315/

Just Because It’s a Seller’s Market Doesn’t Mean Your Home Will Sell Itself

It’s a seller’s market in the high season, as everyone knows by now. So if your home is listed, you’re already halfway to the bank, right?

Slow your roll, O Zealous Seller! It’s still perfectly possible to scotch your own sale. There are plenty of things you should do, and avoid, to make sure you actually make it to closing day, your way.

“When properties are moving quickly, if your home doesn’t sell within the first couple of weeks, buyers will start to perceive your home as market-worn,” says Dave Fry of The Fry Group, a Keller Williams premier realty in Minneapolis–Saint Paul. “They’ll assume there is an issue with it and consider themselves in a stronger bargaining position or reject the home altogether.”

So if you’re selling your home, don’t just phone it in. We talked to local experts in some of the nation’s hottest markets right now for tips on how you can ride the wave—as opposed to getting swept up in it.

1. Price to sell

So many factors can feed in to your initial list price: market inventory, perceived vs. actual value, and others. Sellers often fall victim to the lure of a gigantic payday, thinking the higher the price, the higher their take-home. That is almost never true, says Alison Sternfels, a 17-year Realtor® with Re/Max in Atlanta.

“In this market,” she said, “buyers don’t think sellers are negotiating very much. If you overprice it, you’ll lose the sweet spot of the first 45 days on the market. Even if you price it $20K over, instead of making an offer, they’ll move on.” Your house will take longer to sell, and you’ll likely end up having to cut the price anyway.

“The strategy we hear a lot—‘We can always come down in price’—can be a very costly one,” says Fry. “I understand that nobody wants to leave money on the table, but unfortunately this strategy does exactly that.”

2. Don’t get booed off the stage

Even the nicest, newest cribs need TLC, says JD Esajian of FortuneBuilders.TV, a real estate investing website.

“People don’t buy empty, nice, renovated houses,” he says. “People buy homes. And staging makes a house a home.” As awesome as your house may be, it’s your home. Strategic staging offers prospective buyers visual cues to help them picture your house as their home—which can translate to a sale.

“Some buyers are capable of visualizing, but most are not,” says Sternfels, who estimates that 60% to 70% of prospective buyers need a little help to imagine themselves in your home. “Stagers have the expertise to make the most out of certain spaces in the home.”

3. Nab them at the curb

The outside of your home is at least as important as the inside. Brown grass, sketchy shrubs, wilting flowers, peeling paint—all those and more can disqualify a home before your prospect walks through the door, says Jay O’Brien, managing partner and Realtor with Re/Max Prestige in the hot region of Anaheim Hills/Costa Mesa, CA.

“You don’t need to redo your entire house, but there are cost-effective improvements you can make that will dramatically enhance the appeal to your property, like a freshly landscaped yard, clean windows, and a tidy house,” O’Brien says.

Fry adds that we sometimes forsake the exterior to declutter and streamline the inside—but both remain important.

“The first impression is everything,” he says. “Most of us open the garage door, park the car, and enter our house from the garage and rarely enter through the front door. Take the time to act like a buyer and enter your home from there, remembering that they will be spending time waiting for the Realtor to unlock the door so they will get a real good look there. Touch up paint, clean off cobwebs, shine your door handle, freshen up landscaping, and scan for brown spots in the lawn if you have a pet. This all matters.”

4. Choose your agent wisely

For all of the above, your best counselor is a good agent—even if you’ve got the nicest digs on the block.

“It’s paramount to hire a Realtor that you like, trust, and respect,” says O’Brien, adding that even in a lively market, if you don’t match well with your listing agent, your sale could be adversely affected.

“The feeling must be mutual, or no working relationship should ever take place,” he says.

Use the list above, do your homework and due diligence, and remember: Stay humble. These markets and others may be going gangbusters with activity, but selling your home is never a given. You and your Realtor will still need to hustle to land the right buyer.

Source: Realtor.com, Will Pollock
http://www.realtor.com/advice/sell/in-a-sellers-market-you-still-need-to-sell-hard/

Here's Where Buyers Are Paying All-Cash

While the number of all-cash transactions is dropping nationwide, a few pockets across the country are still seeing a large share of buyers paying all-cash for their home purchase.

Read more: Fewer Home Buyers Pay All-Cash
Nationwide, the number of all-cash sales making up transactions has plummeted since peaking in January 2011 when cash transactions made up 46.5 percent of total home sales nationally. Now, that percentage has dropped to 33.7 percent of total home sales, according to CoreLogic's cash sales report.

The year-over-year share of cash sales has fallen each month since January 2013.

Despite the drops, cash sales still remain elevated by historical standards. Prior to the housing crisis, cash sales made up about 25 percent of home sales, according to CoreLogic. If cash sales continue to fall at the most recent pace, the share should hit 25 percent by mid-2017.

The largest number of cash sales are through real estate-owned sales, with nearly 57 percent of cash sales being from REOs. Resales followed with the highest cash share at 33 percent, followed by short sales at 30 percent and newly constructed homes at 15 percent.

The following states had the highest share of cash sales in April, the latest data available from CoreLogic:

• Florida: 51.4% of transactions were from cash sales
• Alabama: 48.5%
• West Virginia: 48.3%
• New York: 45.4%
• Kentucky: 41.4%

By metro level, the following cities had the largest number of cash sales:

• West Palm Beach-Boca Raton-Delray Beach, Fla.: 59.1%
• North Port-Sarasota-Bradenton, Fla.: 58.5%
• Cape Coral-Fort Myers, Fla.: 58.1%
• Detroit-Dearborn-Livonia, Mich.: 58%
• Fort Lauderdale-Pompano Beach-Deerfield Beach, Fla.: 56.9%

Meanwhile, Syracuse, N.Y., had the lowest share of cash sales at 11 percent, according to CoreLogic.

Source: Realtor Mag Online
http://realtormag.realtor.org/daily-news/2015/07/20/here-s-where-buyers-are-paying-all-cash?om_rid=AAFmZk&om_mid=_BVrTcoB9DsGkv7&om_ntype=RMODaily