Making an offer on a home is a huge commitment and step towards purchasing a house. You don’t want to be surprised a few months after buying a home with termites or sewage issues or flooding. It’s easy to feel like you’re being taken advantage of in the housing industry as the market is hard to follow and always changing. Ensure that you will pay the most fair price for your home by asking these 8 questions before making an offer.
What is the market value of the home?
Real estate agents won’t tell you what they think you should offer but they can give you an estimate based on “comps,” similar houses that have recently sold in the same area. Comps will give you an idea of what prices these homes are selling at so that you can see how fairly the home you’re looking at is priced.
How flexible is the seller?
Most homeowners will set their listing price much higher than they expect to receive because buyers will bargain the price down. Regardless, it is helpful to have an idea of how willing the seller is to bargain on the price of their home. If the seller is set on their price and isn’t willing to budge, you don’t want to lose the house by offering too low.
Are there any problems/maintenance issues with the house?
Most states require that a seller discloses all information regarding any maintenance issues or problems with the house. Ask about the age of the roof, foundation status, insulation in the walls and anything else that could result in extra expenditures for you. Many buyers choose to have a home inspection done, if the home has already been inspected, you can ask to see the reports. Find out the reasons to have a home inspection here. Make sure to cover all of your bases because the more problems there are with the home, the less you will be able to justifiably offer.
What is the surrounding neighborhood and location like?
You should always ask the real estate agent about the community your home is located in. If you have kids, ask about the schools available or nearby parks. One thing most people forget to mention until later are any nuisance factors that exist in the neighborhood. If there’s a train track nearby or rock band next door you might want to know about it beforehand. Also, be sure to ask if your home is located in a floodplain as it will then require flood insurance, an extra cost you will have to pay.
Do you have paperwork for the mechanical systems?
Ask the real estate agent for any documentation they have on the appliances in the home, air conditioning, plumbing, washer and dryer, etc. If they were recently replaced, they probably won’t require maintenance or repair any time soon. Also, if there is a warranty on any of the appliances, ask for the paperwork and save yourself the cost of replacement!
How long has your home been on the market?
How long a home has been on the market is a huge indicator of whether or not it is priced fairly and correctly. You have to wonder why no one has purchased a home that’s been on the market for a long time, is there an issue you aren’t seeing? Perhaps the seller is being stubborn about their asking price. Regardless, the longer it has been on the market, the less you can offer.
How much did the seller pay for the home?
Markets are always changing and inflation will definitely affect the current price of a home but knowing what the seller paid can be helpful in determining your offer. Many people buy a home, “flip it” and then sell it for a much higher price resulting in a profit for them. Sellers will also justify a huge increase in price by renovating or updating certain features of a home. You should check that the improvements made and jump in price are equivalent because most people won’t take the time to verify this and will end up with an overpriced home.
Have there been any other offers?
Ask about any other offers made on the home or any interest shown by other buyers. You can find out why those offers weren’t accepted and whether or not you are ready to compete with other buyers price-wise.
For any more questions you might have about making an offer on a home or the buying process, get in touch with a Door agent today!