Home Buyers: How to Save Thousands When You Buy Your Home

Dated: December 15 2021

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How to Save Thousands When You Buy Your Home

Home Buyers: How to Save Thousands When You Buy Your Home

When you analyze successful home buyers who know how to purchase a new home for thousands less than the seller’s asking price, some common denominators emerge.

Like most home buyers, you probably have two primary considerations in mind when you start looking for a home. You want to find a home that is a perfect match for your needs and desires. And you want to purchase your home for the lowest possible price.

Although your agent’s negotiating skills are important, there are three additional key factors that need to be in play long before you ever make an offer.

These Steps Will Help You Save Thousands When You Buy a Home.

Step 1: Make sure you know what you want.

It may sound simple, but many home buyers don't really know what they want when they begin their search for a new home. As a matter of fact, when you’re looking for a place to live, there are two homes competing for your attention: the one that meets your needs, and the one that fulfils your desires. Your goal should to find one home that meets both needs. But this doesn’t always happen in the real world.

When you look for homes, you'll probably fall in love with one or another home for completely different reasons. Should we buy the 4-bedroom home with room for the family to grow, or the one with the big eat-in kitchen that entices you with visions of big family brunches on weekends? Which is more important: a big backyard, or proximity to the children's school? Too often, people buy a home for all the wrong reasons, then regret the choice when the home doesn't meet their family’s needs.

Step 2: Don't shop with stars in your eyes!

First, satisfy your needs. With luck, you'll be able to find a home that satisfies your needs and also fulfils your desires. It is important to understand the difference before the excitement of looking for a home affects your good judgement.

Step 3: Ask if your agent offers a Buyer Profile System or House-hunting Service.

A Buyer Profile or House-hunting service can take much of the guesswork out of finding a home that both matches your needs and satisfies your dreams. These programs cross-match your criteria with ALL available homes on the market, and provide current printed information throughout your home search. Program such as these help homeowners take off their rose-colored glasses and move into the affordable home of their dreams. 

To help you develop your home-buying strategy, use the form follows.

What do I absolutely NEED in my next home?

1. __________________________________

2. __________________________________

3. __________________________________

4. __________________________________

5. __________________________________

What would I absolutely LOVE in my next home?

1. __________________________________

2. __________________________________

3. __________________________________

4. __________________________________

5. __________________________________

These Steps Will Help You Save Thousands When You Buy a Home.

To understand how much to offer for a home you like, you need to know how sellers price homes. Below are four common strategies you’ll begin to recognize when you start looking at homes.

(1) The home is clearly overpriced.

Sellers always want to get as much as they can for their homes, and real estate agents are aware of this. If more than one agent is competing for a listing, an easy way to win the battle is to inflate the value of the home. It’s done much too often, with the result that many homes are priced 10%–20% over true market value.

This obviously isn’t in your best interest because—in most cases—the market won't be fooled. As a result, the home could languish on the market for months, leaving the seller with a couple of important disadvantages:

  • The home is likely to be labelled as a troubled house by other agents, which leads to a price that is lower than the fair market value when a buyer finally makes an offer.
  • The seller has been inconvenienced by having to always maintain the home in selling condition… for absolutely nothing! These home listings often expire, forcing the seller to begin the listing process all over again.

(2) The home is somewhat overpriced

Roughly three quarters of the homes on the market are 5%–10% overpriced. As with the clearly overpriced homes, these will sit on the market longer than they should. There is usually one of two factors at play: either the seller truly believes that the home is worth this much despite what the market indicates (there's a lot of emotion influencing the decision), OR the seller has left some room for negotiating. Either way, this strategy will cost the seller, both in terms of time on the market and, ultimately, the price received from the sale

(3) The home is correctly priced at market value.

Happily, some sellers do understand that real estate is a commodity that reacts like any other commodity in our capitalistic system: prices depend on the principle of supply and demand. These sellers carefully and realistically price their homes based on a thorough analysis of other homes on the market. These competitively priced homes sell within a reasonable time and very close to the asking price.

(4) The home is priced below the fair market value.

Ensuring a quick sale motivates some sellers. Their homes attract multiple offers and sell fast, frequently in just a few days, at or above the asking price. Be careful and consider whether or not the agent suggesting this method is doing so with your best interest in mind.

We hope this report has provided some insight into how to differentiate between what you need in a home and what you’d absolutely love to have, then potentially save money by determining whether the “love to have” features are worth the inflated price you might have to pay to get them.

Please contact us here to schedule a free consultation if we can help you or a friend understand the complexities of buying or selling a home. We’ll chat with you for about 15 to 30 minutes and show you the latest home buying and selling strategies and technologies.

No high pressure; just plain, honest talk about what it will take to buy your new home. Your consultation is completely free and does not obligate you in any way.

We look forward to hearing from you soon!

Blog author image

Neville Adomi

WHAT DO I DO? - I am passionate about helping my clients have a memorable experience when they buy and/or sell their homes. Moving to a new home is one of the most stressful experiences for most peopl....

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