Real estate has been a hot topic in the news for several years now. The boom, and subsequent bust have left many home buyers wondering how to make sense of the market. While there are certainly new challenges in the current real estate situation, there are still important foundational truths that all consumers should be aware of when it comes to buying a home.
1. Real estate is local.
Due to many external factors including supply and demand, real estate remains a very local commodity. When national news stations report changes in the real estate market, this may not hold true for your particular area. Real estate values and trends can vary by large degrees even within a geographical area of just a few miles. Never trust the national news for your local real estate picture.
2. Not all agents are created equal, even if they all have a license.
Buying a home is still the largest financial transaction most consumers make in their lifetime. Trusting the process to your best friend, your neighbor’s husband’s cousin’s sister, or aunt Ida who sells real estate “on the side” while working at her “real job” can prove to be a foolish mistake. Choosing an agent should be a carefully thought out consideration. Choosing the wrong agent can potentially cost you thousands of dollars and years of trouble.
3. Real estate transactions can’t be perfectly “timed”.
Many people try to “time” their purchase so they pay the lowest dollar amount. It is virtually impossible to know when the best time is to buy a home. I always told clients the “best time” is when the time is right for your goals and life situation.
4. Buying a home is not like buying investment funds.
Yes, a home can be a great “investment”. First and foremost, however, it is a “home”. This is the place you will live, raise kids, know neighbors, feel a sense of “place” in the world, and enjoy your life. Purchase a home with these criteria in mind. Don’t just decide the house is a great “investment” and hate coming home everyday to it. Life is too short for this kind of thinking.
5. There is more to consider than just the price of the home.
Rather than focusing on the sale price, consider other hidden factors that can end up saving you thousands. Will the seller pay for all new appliances, or replace the roof? If so, your cash out-of-pocket savings can far outweigh $10,000 off the purchase price. Ask for things such as a home protection plan covering 5 years. This could save you thousands in the future when money may be tight. An experienced agent can help you with this.
Laura Wrede, CA Real Estate