How to buy a house! ~ I wrote this in 2015 and in some ways it is very quaint. It makes me long for simpler times.
Buying a home is a scary prospect and I typically find that buyers who are not scared are either not really going to buy a house or bought a home before or have a relative who was in the real estate business. Why is it scary? There are lots of reasons…
For a couple this can signify a bigger commitment than marriage because now there is mortgage. Mortgages are not easy to dissolve and may prove harder to dissolve than the marriage. Fear of the unknown, the housing market goes up and down and where it will go nobody knows. Buyers worry about their jobs, people’s jobs are no longer stable. This fact has changed in the last 5 years. People get laid off or have to move for their job quite frequently. Buyers worry about losing financial autonomy, less vacations, less toys, less dining out, to some this signals less fun…some buyers there is the fear of buying a money pit. Most people do not know about construction, the costs and what are major and minor issues in a home.
But what I have seen are amazing transformations in people’s lives and that is why I love this business.
My very first sale was a couple I met at an open house, I was not sure how it was going to work because one of the buyers Tori kept calling me the "Realtor Lady" and not by my name. I learned she had a large down-payment that was a settlement because her husband paid her out in a settlement because he was not faithful... Tori and John and I looked at a lot of places and finally identified a property in the San Lorenzo Valley it was very small and in a special environmental hazard zone. Yet it had room for all of John's big boy toys and it was in an excellent commute location for both of them. They bought the house and even though it is a bit too small for them, what really happened is Tori felt more secure with her boyfriend John enough to fall in love again. And they got married. She finally trusted again. (side note I sold there house 16 years later, and they are the most endearing couple) (I think her ex-husband cheated with a real estate agent)
The process of buying a home:
There are a lot of brokers who coach new agents "do not show people properties until they have spoken with a lender to get pre-qualified for a mortgage." I understand that philosophy but when people get excited they want to see some houses. So often the first step is to see some houses. Generally buyers have a few they want to see. After that buyers look at listings I send them by email.
The other service I provide is sorting through the listings and looking for pitfalls or attributes, my job is detecting difficult sellers, poor location and sometimes I have background information that can aid in their property selection before we even get to the property. For instance, recently a buyer wanted to look at a property on the westside. This was one I had actually sold in 2007 I let her know the pictures were not showing her what a busy location it is not a good family home which is what she is looking for. She appreciated this insight it saved her some time.
Meeting with an agent is important –At the time of showing the property it is a natural time to talk with buyers and get to know their preferences while going over the current condition of that home. After this first appointment I then refer them to a lender and coordinate their contact. After they have become qualified or at least the lender has given them the go ahead we go back out searching. Searching is a process of elimination not selection.
I counsel buyers in Santa Cruz “that you have to think about what you are willing to give up, can they give up being closer to work or school, can they give up the bright white picket fence and put it in themselves. Can they give up dinners out for a bit more house? With the current prices of our homes often buyers have to consider what they can compromise on.
During this second round of showings I discuss the offer process and the inspection process.
I try to go slow with the information because there is a lot coming at a buyer. A buyer has a lot to consider:
Are the schools good
What about re-sale
What about the neighborhood
In our area, the home will most likely have pest issues, or needs some repairs. What fixes do they need to make now, which ones can wait.
For some buyers they worry about the health care availability.
Some buyers worry about future job prospects in the area
Some worry about crime
We discuss this while we go over other aspects. When they find a home I request we go over the purchase contract one time in person (now on zoom.) Then after that they have the option of signing the contract online. I offer an online service that allows for documents to be signed online. Because often it is the second or third attempt at a purchase that a property goes under contract we do not need to meet each time unless the buyer wants to. They never want to come back in to review another contract, they want to see if they can get that house. They have families, jobs and busy lives so using online services is often very much appreciated.
"Congratulations" buyers in are contract, wait what does that mean? Well there are contractual obligations that need to be followed and after the excitement of looking at houses and then going through the offering process all the explaining of that contract goes out the window! That is okay I am prepared to walk the buyers through what they need to do and what they have signed on for.
We have looked at houses, they have identified a house or two, made on offer and now they have a seller that has agreed to sell them a house. They are in contract. Next up inspections if they have not been provided, I typically recommend a home inspection which is an overview of a house by a professional. This process is a bit scary the home inspector inspects the home and gives the buyer an overview. First time homebuyers worry and often my job is to translate and allay fears of problems if the issues found do not seem to major.
I then recommend a termite/pest inspection this is an inspection of the home for pests of all types including rats and mice. The termite inspector also looks for water leaks because that is where a home can suffer the most damage from fungus or from termite damage. Wet damaged wood is like a steak dinner for a termite. With the completion of this report I can help a buyer decide what is worrisome and what can be handled after the sale. I also do offer suggestions of green practices for pest eradication.
With all of this is an onslaught of paperwork comes at the buyer, (disclosures) this is paperwork disclosing known problems or concerns. It can be very redundant and annoying for a buyer. I do my best to highlight the important areas for review and ask them to pay special attention if I see real problems. It would be easy with so much to read to miss vital information.
I have gone over the technical aspect but what I truly excel at is hardest to quantify. Home buying is often an emotional process and where I shine is helping people manage their emotions so they can navigate the process with a clear head. Once the buyer gets into the nuts and bolts of purchasing this can also trigger feelings of fear, paranoia and anxiety of making the wrong decision. Where I can ease tensions is present a calm and quiet approach to information gathering and decisions. I am upfront about issues with the sale process or issues with the home so they feel informed and empowered with knowledge to decide for themselves what they want to do with their new knowledge.
I had clients who were young, hopeful buyers they were having their first baby they were on the ground floor of a promising tech start-up and they were ready to go. The property they found had what they were looking for, a small house in front and a big new home in the back. The home up front was original and very old. The home inspection detected the little front house was not hooked up to the sewer system. And it was later thought it possibly never had been hooked up. The (husband) buyer freaked out, he said he had to have this house he said "he needed it." I told him very calmly he needed the bare necessities and a healthy delivery of his baby. He looked at me and said “ you are right” a few days later they backed out of the contract and found a much more suitable home. What I provide is an environment for people to make decisions based on their lives, wants and needs and I provide the information and the space for them to do that.
Anybody can show a house and write a contract it takes a special professional to sell a home in such way the buyers feel the process was seamless and they made the right decision.
Posted by Michele Replogle on