How much should you offer for that home?

You’ve found a home you want to buy, but how much should you offer to pay for it?

One of the most perplexing points in the home-buying process is the decision of how much to offer for the home you want to buy. If you offer “too much,” you might experience buyer’s remorse or feel the house was “overpriced.” Yet if you offer “too little,” you might infuriate the seller and lose your opportunity to purchase the property.

So, what’s the right amount?

To answer that question, you’ll need to do some homework and give some serious thought to how sincerely you want to buy that particular home.

Your agent can make offer recommendations
Don’t rely on the listing agent who represents the seller to help you decide how much to offer for the home you want to buy. Rather, ask your own real estate agent about the asking and selling prices of other homes in the area and market conditions that might indicate whether you should offer more or less than the seller’s asking price.

If the market is characterized by multiple offers and strong demand relative to the supply of for-sale homes, you might want to offer more than you would if the market were characterized by price reductions and weak demand relative to supply.

You also might want to offer more if the home has certain features that are must-haves for you, but aren’t widely available on other comparable homes in the area.

Time pressure could be another reason to offer a higher price if your current home is already on the market or you need to move by a certain date due to school schedules, employment or other reasons.

Some buyers try to anticipate the direction of home prices and build that expectation into their offer. Future prices may be important if you intend to sell the home within a few years, but market cycles may be less relevant if you plan to stay put for a while. Moreover, sellers may be loath to discount their asking price simply because you think prices might be lower in the future.

Offers that are contingent upon an appraisal, financing, the sale your current home or other conditions are less attractive to the seller than are offers that don’t include such requirements. If your offer contains contingencies, you may wish to offer a higher price as an inducement to the seller to accept those conditions on the sale.

Be cautious about online estimates
Automated valuation services on real estate Web sites are a popular resource for home price estimates. These estimates are not appraisals; rather, they rely heavily on historical home-sales data. Consequently, they might not be a reliable indicator of a home’s current value, especially if the market is on a turning point.

A similar resource is local multiple-listing services data about homes that are currently on the market. This data may be available on local MLS or brokerage company Web sites.

Don’t exceed your budget
Never offer more for a home than you actually can afford to pay. Get a pre-approval letter from your lender that states how much you can borrow and an estimate of your closing costs. Be honest with your agent about how much you’re willing and able to spend and what features you must have in your home.

For more information go to www.phillyrealestateinformation.com

Help Your Buyer Daydream

Getting your home ready for a potential sale can be a bit of a nerve wracking task. You have to clean your home immaculately, light it properly, make sure your fixtures sparkle and basically get your home in a condition that you would never live in just to have a stranger walk throughout your house.

While all of that may be true, getting a potential buyer to see your home as you do is a crucial step in marketing your property. The better you convey the unique and wonderful nature of your home, the more likely you are to receive a full offer on the property in short order. Homes that show well have the tendency to sell quickly, meaning that you will never have to clean that particular home so thoroughly ever again.

That is all well and good but for most people, the time and energy it takes to make a home sparkle simply isn’t available. So, to help cut through a bit of that tedium, there are some tips you can use to make sure that your effort is spent in the right area, maximizing the effect on a potential buyer will ensuring that your effort is used in a smart way.

Go On Clutter Patrol
The simple fact is that most buyers will envision your home not in a way that they would decorate it, but in the way it looks when they see it. If your home is full of random toys on the ground or an unmade bed or two, that is the impression the buyer will take away from your entire home. A sloppy, cluttered look is simply not a good image to have attached to your property.

Organization of your home is a great thing to aspire to but not everyone has the time or money to invest in elaborate shelving systems or a clever series of drawers to hold excess items. Instead, be practical about what you pick up and how you arrange it. Your kids’ toys can be out, just not thrown all over the floor. A toy bin is a simple way to get them out of the way of a buyer without calling for excessive effort.

Minimize Your Personal Items
Leaving furniture out that you have purchased to accent your home shows off your personality and is a fine way to give a property a home-like feeling. Leaving out that fun vacation picture you took of your family where everyone is making a funny face might show a little bit too much personality and give the buyer a notion of you that can color how they feel about your property.

Getting a buyer to envision living in the property is the ultimate goal of a showing and with your life dominating picture frames and walls all around the home, that can be a difficult phenomenon to accomplish. Do what you can to remove yourself from the home’s surroundings and instead make it as easy as possible for a buyer to start daydreaming about how the home will fit them, not how it fit you.

Certainly, showing a home can be a daunting prospect at first. Though cleaning is an important part of the showing process, going beyond that without spending too much time and effort through removing clutter and storing away the majority of your most personal items will make the showing of your home more effective. Do what you can to highlight your home instead of your life through your showing and you will achieve better results. Cleaning 10 hours a day is simply not practical. Instead, focus on what you can change quickly to show off the beauty of your home.

For more information go to www.phillyrealestateinformation.com

About As-Is Offers

To make an “as-is offer” is to state that you, the buyer, will take the property in the condition it is in as of the date you make the offer, and will not ask the seller to do any work or repairs to the home. You can see why these offers are so attractive to sellers; they love the idea of being able to mentally move on from this home to the next one as soon as they accept your offer. In the olden days, many states required that certain basic condition standards be met by every property sold, whether or not the buyer asked the seller to do any work: no broken windows, no termites, etc. Today, “as-is” is the default under the contract in many states; unless Buyer and Seller specifically agree that Seller will do something, the property will pass to Buyer in the same condition as when the contract was affirmed. Other states have remained old-school and maintain standards that the Seller will have to — or is expected to — meet prior to closing. Before you spend time agonizing over whether to make an as-is offer, check in with your Realtor. In some markets, sellers expect to have to complete some repairs, so the issue is, well, a non-issue!

If You’re Thinking of Making an As-Is Offer
The ideal property to offer to take in as-is condition is one where:

• The property is new or appears to be well-maintained;
• The seller has prepared their property-related disclosures and shared them with you before your offer (e.g., in a binder at the property or online); and
• The seller has had a pest or “termite” inspection (also known as a Wood Destroying Organism inspection or WDO for short), and/or property inspections prior to listing the home, has given you the opportunity to read the reports, and you feel comfortable taking on the responsibility for the repairs recommended therein.

Whether or not all the above-listed ducks are in a row, you’ll need to weigh the pros and cons of making an as-is offer on a property — and situation — specific basis. Do you have cash to do repairs later? Do you not want the seller to do repairs so you can hire the contractors and choose the supplies yourself? Depending on the severity of needed repairs, are you okay with living in the home and taking care of those gradually over time? Or are you simply unable or unwilling to either have repairs done or live with items needing repair — period?

If you do make an as-is offer, make sure to have your inspections as early as possible and get repair cost estimates prior to removing your contingencies. This way you don’t get yourself in over your head, and you will know whether or not you need to back out or renegotiate with the seller.

Making an as-is offer is essentially your promise that you won’t ask the seller to do any more work to the property. That promise is not set in stone, though, because most sellers would prefer to close the deal with you than to put the property back on the market if major hidden repairs come to light after your inspections. However, you shouldn’t make an as-is offer with the intention to approach the seller and ask for repairs or credits later. Only make one if you’re prepared to handle all obvious needed repairs and some degree of non-obvious repairs that your inspectors might uncover.

If you know from the first moment you see the place that you are planning to ask the seller to fix things or that you are unwilling to take the property if the inspectors find almost anything wrong, then don’t make an as-is offer. (Realtors whose buyer-clients frequently make as-is offers, then try to renegotiate, lose credibility among listing agents. This sort of reputation makes it harder for their buyer clients’ offers to be accepted in the future.) However, if you do make an as-is offer you also shouldn’t hesitate, in the event the inspector comes back with truly major non-obvious and undisclosed items, to issue the ultimatum that you will either need Seller’s help with the work (monetarily or otherwise), or to back out of the deal.

For more information go to www.phillyrealestateinformation.com