Your journey to become a homeowner started years ago. You saved money, improved your credit, researched mortgages, and scoured the area looking for the ideal property. Now that you’ve finally found a place that checks all the boxes, you want to submit an offer before the opportunity passes. Although it seems like the natural order of the home buying process, making an offer without completing these steps could result in an investment you come to regret.
Ensure It’s What You Want
Making an impromptu offer on a house simply because you’re tired of searching for the right home is the worst mistake you can make. Remember, more than a property, this is where you will live for the next few years or more. Does it have everything you need and want? Is it in a safe location? Are there job opportunities and access to amenities and businesses you use every day? If you can’t answer yes to each of these questions, perhaps you should hold off on making an offer.
Evaluate Homeownership Costs
Some buyers want a property so badly that they overlook the actual costs of homeownership. They submit an offer and take possession of a property they can’t afford. Before long, they’re inundated with debt and on the brink of foreclosure. No house is worth the stress of going into debt.
You must have a down payment, cover closing costs, and pay for other housing expenses like insurance, property taxes, utilities, and maintenance while covering other monthly bills. Experts say you shouldn’t spend more than 30% of your income on housing. Anything more than that could be financial suicide.
Check Home Improvement History (Permits)
When you purchase a car, you pull the car’s facts or history to ensure it’s a wise investment. The information in these reports will tell you how many owners the vehicle had, past damage, and a record of maintenance and repairs. If a vehicle has had multiple owners, been in accidents, or suffered water damage, chances are you’d walk away. The same should be done when purchasing a home.
Before submitting an offer on a house, ask your real estate agent about checking the building permits or home improvement history. Ultimately, if any significant projects have been completed on a property, contractors would have to pull permits to ensure the improvements complied with building codes and legislation. If you can’t find permits, it means that any work done on the house was not inspected and could end up costing you in the long run.
Research The Market
How do you know if you’re getting a good deal on a house? You analyze the local market. There’s nothing worse than making an offer that causes you to lose money. Check comparable properties in the area. What is the average asking price? Have the values fluctuated over the years, and if so, was it in favor of homeowners or buyers? How long do properties stay on the market? Learning the answers to these questions can help you determine whether you’re making the right investment.
Make Your List of Demands
Some buyers make the mistake of submitting an offer without making any demands. The fear is that the seller won’t agree and select another offer instead. While that is a possibility, it doesn’t take away your right to negotiate. If you feel that the asking price is too high, offer something close yet affordable.
If there are necessary repairs that will incur added expenses to your plate, ask the seller to take care of the issues before closing. At the end of the day, it’s about getting the best deal possible, so don’t be afraid to speak up. Even if you don’t get everything you ask for, the seller is often willing to compromise so you both win.
When you finally find a home you want to call your own, the anticipation can cause you to make an offer right away. Be that as it may, making impulsive decisions could result in you making a lifelong investment riddled with problems. Before submitting an offer on a property, buyers are encouraged to work with their real estate agents and attorneys to do their due diligence and make a choice you’ll appreciate for years to come.