What are the Major questions home buyers should ask in today’s market?
Here are Seven ( 7 ) of the most important home buying questions:
1. What is this property worth in today’s market?
An agent should arm you with plenty of comparables — prices of similar, nearby homes that have been sold recently — along with high and low ranges for a particular property.
Your agent can tell you how long homes are staying on the market, and the percentage of the asking price sellers are getting, says Dick Gaylord, past president of the National Association of Realtors. This information tells you how hot the market is where you are looking.
Also ask how long the property has been on the market. If it’s been languishing for months with nary an offer, it could be slow market or it could be overpriced, says Robert Irwin, author of “Tips and Traps When Negotiating Real Estate.”
For ethical reasons, agents can’t tell you how much to offer.
2. How flexible is the seller on the asking price?
Keeping it in terms of “how flexible are they on the price?” instead of “how much less will they take?” allows you to feel out the situation without offending the seller, Irwin says.
Not every seller will be willing to bargain, so if your strategy is to make lowball offers, plan to make “offers on several properties before you connect with a seller who will deal.” Lowball offers or several offers on several properties at one time takes nerves of steel and BIG check book. Remember with each Offer an Ernest Money Deposit of about 1% to 3% should be attached to each offer. For example Five offers on Five properties of $300,000 each would five, yes FIVE $3,000 Ernest Money Deposit Checks. Can you put up $15,000 ?
A question that often goes hand-in-hand: Is the seller willing to help with the closing costs?
3. What’s wrong with this house?
“One of the things that’s happening now is every house is in ‘perfect condition’. The sellers really want to get rid of the properties, so they’re failing to disclose any real problems.”
Take the direct approach and Ask: “Is there a problem with this house?”
Many Realtors recommends reminding sellers that with inspections and disclosures, chances are you’ll find any problems. “So if the sellers just get it out in the open, they’ll avoid wasting your time and theirs.”
Some sellers’ agents recommend a home inspection before putting the home on the market. If one has been done, ask to read it.
North Carolina mandate disclosure forms in which sellers have to reveal any issues or problems with the house. The disclosure not only provided information, but it also started a dialogue with the seller.
4. Is this home in a flood plain?
Living in a flood plain can require flood insurance, which can affect the cost of living in the house, Foltz says. Be sure to ask if the home is in a flood plain.
The Federal Emergency Management Agency, or FEMA, posts free online maps that show if your home-to-be is in a flood plain. It doesn’t hurt to double-check with the county, and talk with your property agent, too.
If you discover that the home you want is in a flood plain, you need to know what type of flood plain (some ratings indicate higher risks than others), and how much flood insurance will cost. (One way to find out: Ask to see the seller’s flood insurance bills.)
Once you have some information, you can weigh your options. Can you afford any additional costs that might be associated with this type of flood plain? And are you still comfortable with the property?
“In most cases it is possible to assume the seller’s flood policy,”
5. Will the lender allow a short sale?
In a short sale, the bank allows the property to be sold for less than the amount of the outstanding mortgage. If the seller’s bank doesn’t give its consent, the short sale can’t happen.
If the seller is not in financial hardship, a short sale wont happen. So don’t ask this question.
6. Are any foreclosures for sale in the area?
It’s the question sellers (and their agents) hate: Are foreclosed homes for sale nearby? Foreclosures usually cost less, and that has to figure into your buying decision.
“It always makes sense to ask if there are other houses for sale in the neighborhood,” “In today’s world, you should also ask if any of these sales are as a result of foreclosures.”
With foreclosures in the neighborhood, “you can assume there will be a lot of price competition, and you may offer less money,”
Foreclosed homes may be less expensive, or lets put it this way? Have you watched the movie “the Money Pit”?
Foreclosed Homes do tend to need work on them. Even the Freddie and Fanny properties, which are in very good shape. Still need quite a bit of work. Good rule of thumb would be $5 to $10 sq ft more in work. But then again, this is where the inspections come into play with ANY home purchase.
7. Do you have the paperwork for the mechanical systems?
Asked more persistently for receipts and documentation about his new home’s appliances and mechanical systems. “But it’s something you don’t have that much control over,” he says.
The seller replaced the air conditioner shortly before putting the home on the market, but didn’t save the paperwork. Without documentation, the new buyers didn’t have a lot of options when the unit malfunctioned.
Here is where asking about a Home Warranty to cover any of these conditions will help.
Source: 7 Questions To Ask Before Buying A Home | Bankrate.com http://www.bankrate.com/finance/real-estate/7-questions-buying-home-1.aspx#ixzz1s8mzIJKg