I get asked for real estate tips or advice all the time. Well, markets change but the principles of buying or selling real estate truly does not. And while every situation is different, I have complied a list of the top five (5) real estate tips that everyone (buying or selling) should consider!
1. Be careful about bidding wars. While most of the homes I work with do sell overprice, bidding wars can get out of control – and fast. In fact, a bidding war might spur you to overspend, but paying an inflated price can make it tough to resell when prices stabilize or sink. So, use caution when a bidding war starts to escalate between more than one buyer.
2. Consider where you put or buy when it comes to home upgrades. Upgrades rarely pay for themselves, but there are 2 spaces that can make or break a home sale: the kitchen and master bath. Putting money into a home or only buying a home based on upgrades not in these two rooms is -essentially- a waste.
3. Be considerate of when you want to move from one home to another. Why? Well, multiple offers on a home may lead to not enough time for you to find your next home. One option you, as a seller, do have is to request a lease-back from the buyer, allowing you to remain in your old home for the time you need to shop for the replacement. This will be contingent on when the new owners need to occupy, and the period is usually limited to 60 days.
4. Know your local economy when making a real estate move. Real estate continues to be a reliable long-term investment prone to usually modest peaks and valleys, done on a deal-by-deal basis and subject to local economies. Don’t make decisions on “bubbles” or what has happened in the past. Make decisions based on your specific circumstances and your local economy.
5. Understand the “hidden” cost of all homes on the market. There are fees. For example, on a $250k home this can happen;
- Origination fee: On a $200,000 mortgage for a $250,000 home, assuming 3.5% interest and no points, you’d pay the lender about $1,800.
- Home inspection: Even if the mortgage insurer doesn’t require one, get one for peace of mind.
- Property taxes: You’ll usually pay a few months upfront.
- Appraisal: The bank will need to determine how much the place is really worth.
- Private mortgage insurance, or PMI: This depends on your down payment and credit rating.
- Other pre-occupancy costs should include home insurance, title insurance and deed-recording fee, and possibly title insurance, survey costs, credit report fees, flood insurance and homeowners association dues/insurance.