1. Am I trying to own the house or win a competition?

Often, in a competitive situation, you may lose sight of your goal. If you’re forced into a multiple counter-offer situation, take a deep breath. Ask yourself: Is this the home I really want or do I just want to beat out the other buyers?

2. Has the potential purchase price exceeded the list price?

Putting an offer on a home at $425K is one thing. But several counter offers may bring the price up to $500K. This can create a completely different set of circumstances, and the home may no longer be right for you.

3. Have I seen the home more than once?

No matter how much you love the property, if you’ve only seen it once, you could be heading for buyer’s remorse. Going back in the evening or a different time of days provides another perspective. Also, you may see things differently the second time around and discover something you missed the first time.

4. Have I opened every door and seen every inch of the property?

A quick tour provides a basic understanding of the floor plan, condition and size. But to really know a home, walk to the end of the lot and look at the back of the home. Open every closet. Go in the attic, basement, and garage. Look at the neighboring houses, too, and try parking your car in the garage.

5. Have I seen a floor plan (if available)?

An architectural floor plan provides an opportunity to see the home in a different context. It’s possible you’ll pick up on things you might have otherwise missed.

6. Have I gone back through the pictures after seeing the home in person?

Returning to the listing photos after visiting a property is always useful. Seeing the photos, which are snapshots in time, gives you a different perspective and may raise important questions. Was the shade closed in the photo and if so, why? Did you ever look out that window? Does the photo remind you that the bedrooms are small because there are only twin or queen sized beds without any nightstands? These types of questions are a great way to evaluate if a home will work for you.

7. Have I had a private tour?

Visiting a home during open houses isn’t ideal. If you’re serious about a home, go back for a private showing. A lot more is revealed when you have time alone in the property.

8. Have I read the seller’s disclosures (if available)?

If you haven’t seen or heard about any disclosures before making an offer, it could be a red flag. In many markets, disclosure packages are available prior to making an offer. If not, a good listing agent will lay out the major disclosure items verbally. Ask if any disclosures are available and read them thoroughly before making an offer. If you’re too busy to review the disclosures, don’t make an offer. Find out if there are inspection, termite, or other reports, too, and review them.

9. Is this home what I set out to look for?

When buyers are in the throes of a competitive market, it’s easy to settle on a home that “kind of” works or lapse into autopilot mode. You may just be ready to buy and be done with it. A good agent will bring you back to your original plan before you sign a contract.

To help protect you from buyer’s remorse, always have an inspection contingency in your purchase agreement. An inspection contingency should be reserved for something serious about the property you didn’t know before making your offer. However, some agents call it the “cold feet” or “buyer’s remorse” contingency because it allows buyers to exit the agreement should something come up.

Bottom line: Never sign an agreement if you aren’t completely convinced this is the home for you.

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As the homebuyer evolves, so does the home. Here are five things today’s homebuyers want.

1. Man Caves and Smart Homes

The media room or “man cave” emerged in real estate marketing a few years ago. Many buyers prefer high-tech rooms with surround sound, large screen TV’s, and the most up-to-date A/V equipment to formal dining rooms.

But some aren’t limiting technology to the home office or man cave/entertainment room. They’re transforming an entire property into a “smart home” with home automation systems.

2. Home Offices

A home office tops today’s buyer’s wish list. Many prefer to have one place dedicated to their laptops, printers and work-related stuff. A dedicated home office is better for tax purposes, too. Either way, try to make your home office as appealing to the next buyer as it is to you. And keep in mind that, provided you don’t build-in a desk or bookshelf, the space can easily be reverted back to a bedroom.

3. Carrie Bradshaw Closets

In the first Sex and the City movie, Mr. Big surprises Carrie Bradshaw by dramatically remodeling a cramped closet into her dream closet, with glowing, glass-enclosed sub-closets.

Today, the walk-in closet is a must-have on many buyers’ wish list. Some homeowners are pairing down a four-bedroom home to three by transforming one bedroom into an oversized walk-in closet.

If you intend to expand a closet or bedroom into a grand walk-in closet, be careful not to overly customize it. The more specific you get with your taste, the fewer people your closet will appeal to when you go to sell.

4. Hardwood Floors

If you walk into a home that hasn’t been on the market for decades, you’ll probably see a lot of wall-to-wall carpeting. This was common in the mid 20th century. Not only did carpeting help reduce heating bills, it was seen as physically comforting and less sterile.

Today, most buyers prefer gleaming hardwood floors. They make a space feel less confined and give it a new, clean feeling. If you see a home you love with wall-to-wall carpeting you don’t love, ask the agent what’s underneath it.

5. Urban Homes With Amenities

Homebuyers today often see large yards as “maintenance.” They’re opting for living in big cities like New York as well as smaller ones such as Baltimore, Pittsburgh, and San Jose. They want active lifestyles and opportunities to socialize; to be near transit hubs; and buildings with amenities, such as a full-service gym.

Think Long-Term

Trends in kitchen countertops, paint colors and bath fixtures come and go. They’re based on larger design or style trends and even fashion trends. However, as society and culture change, the larger fixtures and features of our homes evolve more gradually. They don’t mirror the latest trends so much as they reflect shifts in how we live. As a result, investing in long-term home shifts will usually be a better idea than paying extra money for the latest home fad.

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1. Accept the fact you’ll be stressed. Accepting up front that this process will be extremely stressful will help in the long run. Plan everything as much as possible in advance. Do your homework. And take care of yourself. You’re going to be busier than usual.

2. Meet with your agent early. Owners often believe their home is worth less than what the current market will bear. That’s why it’s important to meet with your real estate agent early on. The agent will help you understand your local market and your home’s true current value and marketability.

3. Learn the purchase market. What’s on your wish list?  What are your priorities?  Determine your need and understand what you will get for the money on the purchase side. Is that housing market competitive?  If so, how long can you expect to be searching? If you’re moving within the city or town where you live, your listing agent will likely serve as your buying agent. If you’re moving just outside your area, ask your agent to refer you to an agent knowledgeable about that market.

4. Get a clear picture of your financing options. Once you understand the numbers on both the purchase and the sale, you need to know your financing options. Contact a local mortgage broker or lender to get your questions answered: How much equity do you have in your current home and is that equity available? What kind of down payment will you need to make a purchase, given the price point and type of home you seek to buy? Do you have enough of a down payment liquid and would a lender allow you to make the purchase before selling the home?

5. Start planning. Now that you know your numbers, it’s time to come up with a plan and execute. The plan can vary greatly, depending upon any number of conditions. A few examples:

* Buying in a competitive market? Adding a contingency that your current home must sell before you buy probably won’t work.

* Selling in a slow market and need the sale proceeds to make a purchase? It could take time before you’re able to sign a purchase agreement. A safe (but not particularly convenient) option is to sell your current home and move into temporary housing.

* Selling in a competitive market? Try to negotiate with your buyer for a longer escrow or even a rent back. This would buy you time on the purchase side.

Know the Variables

There are so many variables that can impact when buying or selling. Identifying and planning for as many variables as possible will help you avoid sleepless nights, stressful days, or fights with your spouse or partner.

The post How to Buy and Sell a Home at the Same Time appeared first on Brendon DeSimone | National Real Estate Expert NYC & SF.

1. Talk to your tax pro. There could be negative or positive tax implications based on when you sell, when you purchased, and when you last lived there. Talk to your CPA well before you plan a sale; it can save you time and money. For example, it might be that selling your home will result in a loss, which could help your taxes, but you want that loss to happen in the next tax year.

2. Leverage your agent. The best real estate agents maintain contact with previous clients. A good agent may even help you obtain new tenants, come to the aid of your current tenant, or be your remote “feet on the street” when you’re trying to sell a home from many miles away. By maintaining ties to your agent, it will be easier to turn to them when you’re ready to finally offload the property and get the ball rolling.

3. Plan a long weekend back to your previous home. Plan a trip to see your property months in advance before selling, if possible. While there, meet face-to-face with the tenant and notify them of your desire to sell. Assess whether the home needs work. If so, meet with the necessary painters, carpenters or stagers. Identify exactly what needs work and get bids. Also interview agents if you don’t have one already. If you already have an agent, meet with them, preferably at your property. Introduce your agent to your tenant, too, if possible.

4. Visit the comps. While back in town, get a feel for the most recent comps, either with your agent or by going to open houses. Try to understand your property’s baseline home value, based on what you see.

5. Treat your tenant well. As stressful as it is on you to sell the home remotely, the tenant has to find a new home, potentially pay more in rent, and physically move.

So treat your tenant well from the very first time you discuss the selling option. Giving them enough advanced notice will benefit them and you. If the property shows well, incentivize your tenant (provided it’s a ‘good’ tenant) to stay in the property during the marketing period by offering to reduce their rent. A “staged” or lived-in home sells faster than a vacant one. Once you have an offer from a buyer, coordinate with the tenant on the timing of a closing. By reducing their rent, you can also ask them to cooperate with showings, open houses or inspections.

If they aren’t a great tenant or the home doesn’t show well with their stuff there, give them enough advanced notice to move out so you can do any necessary work. Be sure their lease has officially ended, that they receive their security deposit back, and there aren’t any loose ends.

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But housing inventory is tight in many areas. At the same time, the poor economy of the past few years has produced more properties in foreclosure or offered in short sales. Many are perfectly fine properties sold as is at a discount. As with any real estate investment, there are risks—and rewards.

The Risks of Foreclosure and Short Sale Properties

In the case of a foreclosure, the bank sells the home “as-is” and requires the buyer to sign dozens of pages of documents releasing the bank of any liability. The worst-case scenario: You buy a foreclosure only to discover a major problem, such as a property line dispute or previous leaks that caused mold or dry rot.

With short sales, the owner is trying to sell for less than the loan amount, so they need the bank to approve the sale. Historically, banks are slow to give the thumps up. This can cause a buyer to wait for months for the bank to approve the short sale–only to have the sale rejected. Meanwhile, the buyer has missed out on countless other properties.

The Rewards

While there are risks in buying a distressed property, we have so much more information available on homes than previous generations had. Today’s Internet-connected, savvy buyer can a lot about foreclosed and short sale properties before making a commitment.

Distressed sales are often priced from 5 percent to as much as 15 percent below the current market value, too.

And foreclosures aren’t necessarily dumps. The recession impacted people in all income brackets. It’s not unusual to discover multi-million dollar homes in excellent condition and in good locations in foreclosure or offered in a short sale.

How to Minimize the Risks

* Search town records for previous building permits. Look to see if anything unusual was completed or planned for the property.

* Get the home inspected before going too far in the buying process.

* Ask neighbors for any information they have about the home, the neighborhood or the previous sellers.

* Look at the home’s previous sales records. If there was ever a contract on the property, there may be an inspection report. Have your agent call the previous listing agent to find out more about the former owners or the property.

* Negotiate with the bank. If you learn of a major problem with the house, negotiate with the bank for a lower price. Don’t forget: The bank isn’t in the business of owning homes. They want foreclosures and short sales off their books as soon as possible. As a result, banks will take you seriously if you’re well qualified and ready to close a deal.

The post Why You Shouldn’t Overlook Foreclosures and Short Sales appeared first on Brendon DeSimone | National Real Estate Expert NYC & SF.

Those features may be selling points. But potential buyers might not value them nearly as much as the seller does. That great view may not be something buyers want to pay extra for. Some might see the garage workspace as a liability. Your unique garden might simply look like a lot of upkeep to a buyer.

When sellers get attached like this to features of their home, it usually results in what Realtors call “Seller Pricing”—based more on the seller’s perceived property value than actual market conditions. After spending time on the market, the home is eventually reduced in price.

Here are three ways sellers and buyers can avoid losing money on home features.

1. Test the waters, briefly. You love your view, garage, or garden. You’re convinced someone else will love it too and won’t mind paying extra for it. And you might be right. But by pricing your home higher because of what you see as a special feature, you’re shrinking the potential market. A beter strategy: Try listing at the higher price briefly. If that view-fanatic buyer is out there, chances are she will show up early on and make an offer. If not, drop the price quickly and sharply to keep your home from becoming “stale.”

2. Don’t get emotional. This is a great time to buy, especially if you have a down payment, a stable job and good credit, and you’re committed to the community for the next few years. Just be careful to always think like a seller, not just as a buyer. Consider the potential market value of your home’s amenities five years down the road. To achieve the maximum equity, try not to overpay for those features, either for competitive or emotional reasons.

3. Don’t just focus on your needs. Case in point: In 2005, a buyer in San Francisco bought a home with no garage. He didn’t see the value in one for himself. The house was on multiple transit lines, he used his bicycle for transportation, and he knew he’d have access to a leased garage space if he needed it. Fast-forward three years. The buyer has to sell in a slow market. He didn’t believe his home should be priced less than a comparable home with a deeded garage because his house was so centrally located. Plus he had the leased garage space nearby. What he didn’t consider was that 25 percent of buyers commute to work and don’t want to risk losing a leased garage space. Buyers wouldn’t even look at his home’s photos online, let alone go to the open house, due to its lack of a garage.

It was a clear example in which the buyer failed to think like a seller. Don’t let yourself fall into that trap.

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New buyers and sellers often come into the real estate market with assumptions about how it works. They may get their ideas from TV reality shows, their parents, or co-workers. The problem is, the new buyer or seller’s assumptions are often based on outdated or uninformed real estate myths.

Here are three such myths you shouldn’t buy into.

1: Spring is the best time to sell.

Historically, real estate seasons were tied to summer and the end of school. Families were the typical buyers or sellers, and they wanted to move during the summer so their kids could start fresh in September. That’s how spring became the prime selling season. There are still more homes for sale in the spring, which means there’s a lot of activity and buzz.

The reality is, spring isn’t necessarily the best time to sell a home anymore. Today, more than half of the buyers aren’t married, and their decisions aren’t based upon school schedules. Instead, the best time to sell a home is in November, December and January.

Most sellers assume buyers aren’t seriously looking during the long holiday season. And yet, many buyers are in fact looking at properties right up until Christmas Eve. After New Year’s Eve, they jump back into the market. The net effect is, savvy sellers face less competition for a still-strong pool of buyers during this period.

2: Always start with your lowest offer.

There’s no generalized strategy for making an offer on a home anywhere, ever. A seller may have overpriced or underpriced a property on purpose. Some markets may be more competitive than others or have certain customs that work.

A buyer in today’s strong, tight-inventory real estate market would be wasting time making low offers right from the beginning. A better strategy: Work with a good local agent and understand the market. You’ll quickly learn that starting low won’t get you anywhere.

3: Cash offers trump all.

Many buyers assume that a seller, considering two different offers, will always go with the cash offer. As a result, buyers who hear they’re competing with a cash offer assume they won’t get the home. They may not even make a formal offer. At the same time, many cash buyers assume that because they’re paying cash, they can make an offer below asking. They think that because there’s much less risk with a cash offer, they’ll have the upper hand against other offers.

The reality? A seller may not necessarily go for the cash. For example, imagine consider a home priced at $399,000. The seller receives two offers: one is $375,000 paid in cash. Another is for the full asking price, with 25 percent down, a bank pre-approval letter, and swift contingency periods.

A good buyer’s agent, upon learning their client is competing with a cash offer, will give the seller lots of data about their client’s finances. The agent may even arrange a call between the seller and the buyer’s lender.

Information, Not Assumptions

When you’re a first-time buyer or seller, the most important thing is to learn your market. Talk to a savvy local agent. Don’t make assumptions based on what you think you know. The reality is, every market is different. If you believe there are general rules for real estate that always apply, you’ll likely be disappointed.

The post Don’t Be Fooled By These 3 Real Estate Myths appeared first on Brendon DeSimone | National Real Estate Expert NYC & SF.

In the current tight real estate market, you have to think outside the box. Here are five ways to go after homes that aren’t actually for sale.

1. Look for expired or withdrawn properties.

Many properties didn’t sell because they were overpriced. Does their last list price seem like a valid price today? Chances are, the owner doesn’t realize how much the market has picked up and might be open to selling. Have your agent contact the seller by letter, expressing your interest in buying the property. If you show that you’re serious, you’ll likely get a serious response.

2. Use ‘Make Me Move’

Scouring the Zillow app on the Sunday open house circuit? Filter listed properties using the app’s “Make Me Move” feature for the neighborhoods where you want to own.

A “Make Me Move” owner has indicated a price with which a buyer would motivate them to sell. Some owners ask for the sun, the moon, and the stars. Others may have listed their property on Zillow months or years ago and their price may in fact be reasonable. Contact them with an offer. It might work.

3. Check Rental Listings

Why go after rental listings? The owner may have lived in the home but had to move for a job transfer, divorce or other life change. At that time, their home could have been underwater or the market simply wouldn’t bear the asking price. So the owner decided to rent and “ride it out” for a while—but doesn’t realize how much the market has changed since then.

4. Don’t Be Afraid of Overpriced Listings

After six weeks or less, an overpriced home loses its luster. The seller doesn’t clean as often. Weeds grow in front. And it may not show as well. The fading curb appeal, along with the unrealistic price, keeps buyers away.

Many sellers won’t list their home at a lower price but they will, at least eventually, sell it at a lower price. Go in with an offer before the first price reduction, if possible. Once the seller drops the price, other buyers will take notice and you may have competition.

5. Ask Your Agent About Pocket Listings

In many markets, real estate agents regularly network with each other about homes not on the market. Some areas have dedicated websites for agents to share off-market properties, also known as ‘pocket’ listings. Also, brokerage firms often release upcoming listings to their agents before they hit the MLS. Work with a well-connected agent and make sure you’re privy to these opportunities.

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Ask the listing agent what the sellers plans are?  Maybe they havent found a home yet and are asking for a quicker closing. Or maybe they have kids in school and prefer not to move too soon but all parties want to move the deal along instead of doing a three-month escrow? Frequently, the solution is that the buyer allows the seller to stay in the home after the close of escrow for a pre-determined amount of time. In return, the seller pays the buyer a pre-determined among for “rent.”  This generally is the buyer’s monthly mortgage prorated for the amount of time the seller stays behind.

You might even consider offering the seller a “free” rent-back. Chances are, you won’t be moving the same day you close. And if you’re renting and your closing date is the middle of the month, you’ll probably have to pay both rent and mortgage for a short period of time. anyhow What could amount to zero extra expense to you could end up helping the seller in a significant way. Not being rushed out of the home and staying a while longer for free is bound to appeal to a seller faced with multiple offers at similar prices.

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Short sales happen because the loan amount on the property is higher than the sale price minus all the sale expenses. In a short sale, the seller is asking the bank to take less than the amount owed.

Here’s a look at why short sales can take so long.

1. The seller’s bank must review the package

In order to approve the sale, the lender requests a complete short sale “package” from the seller. The lender wants to see the seller’s debts and assets, review their credit score, and their contract to purchase the home. A good listing agent will have the short sale package ready in advance.

2. Documents get lost, pages go missing, signatures go unsigned

A short sale package typically contains hundreds of pages. Many require signatures from buyers, sellers, and agents. If one page is missing or one signature left blank, the entire document doesn’t get processed. While this is bad enough, too often the listing agent will fax in 100 pages and just wait for a response. Sometimes it will take a month to hear back from the bank when they find something missing. That’s why it pays to be proactive. Get your listing agent to call the bank after submitting the short sale package, especially if sent by fax.

3. Documents can get quickly outdated

From the time the documents get “processed” and when the information hits the desk of a negotiator, who actually reviews and negotiates the sale, weeks can go by. Does one of your bank statements arrive at the start of the month while the others come at the end? That one bank statement may soon be outdated and the bank will require an updated one. Review the statement dates on each credit card and bank statement so you’ll know if a new one will arrive soon. If so, send it to the lender immediately.

4. The lender asks for more information

The lender may ask to see the buyer’s proof of funds, review the preliminary title report or request further verification of the seller’s hardship (job loss, divorce, job transfer). So you should be ready to respond, because a delay could add a few more weeks to the process.

5. Complications from two loans

Short sales are hard enough with just one bank. Imagine two banks, each with its own processes, and neither one cooperating with the other. It could set you back months.

6. The deal might collapse at the last minute

Once the bank has a complete package and you get a negotiator on the phone, you’re close to the end—but not quite there. The negotiator may counter the buyer on price. Or they may only approve the sale if the seller contributes money. They could always ask for the commission to be lowered. Any of these might kill the deal at the last minute, and you can’t anticipate exactly what the negotiator will ask for. That’s why it’s key to not accept a low offer and think the bank will simply approve it.

7. Foreclosure trumps everything

Sometimes the foreclosure department at the same bank does not work in conjunction with the short sale department. There may be a good offer on the table for a short sale, but the seller is six months behind on payments, causing the foreclosure process to kick in. When this happens, the buyer no longer has a deal on the table. The seller, forced into foreclosure, is no longer the seller—the bank is.

How you can speed up a short sale

The best way to expedite a short sale is to be certain the seller’s real estate agent is experienced with short sales. If the agent isn’t experienced in short sales, the process can likely drag on and on.

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