Have you ever priced your home higher than its worth to leave room for negotiations, but never saw the results you were hoping for? Have you ever lost out on your dream home because someone bought it before you could get pre-approved? Do you believe that every agent is going to produce the same results for your home?
You might be surprised to know all of the common misconceptions related to real estate, but it happens all the time! One of the biggest problems people have with buying or selling property is misinformation -- so it never hurts to cover all your bases before making such a huge financial decision. With the right resources and proper explanation, your success as a buyer or seller will be immeasurable.
With that being said, here are some of the most common real estate myths debunked:
Different Agent, Same Result
One of the most common real estate myths is that all agents are the same, which couldn’t be further from the truth! Of course the general process of buying or selling property is similar across the board -- but the agent's creative approach, personality, ability to negotiate and provide ample resources, responsiveness, and level of experience is going to greatly influence outcome.
Much like other professional industries, there will always be those who are completely dedicated to their work, highly creative in problem solving, and put in the necessary time and effort to satisfy their clients. On the other hand, there will be some who do the bare minimum to get by.
You may (or may not) have had a negative experience with an agent in the past, but don't let that discourage you from finding the perfect fit. The important thing to remember here is to do some research before deciding who you want to work with - and never assume that every person is going to produce the same results! There are real estate agents out there that will be dedicated to finding exactly what you need.
Home Inspections - Pass or Fail
The results from a home inspection are not a matter of passing or failing - that’s not how it works! The whole purpose of an inspection is to assess the condition of your home - good AND bad. It will provide you with a summary that reports the age of any key systems (which include plumbing, roofing, HVAC, electrical, etc), as well as any issues that your home might have. If anything, this is going to give you a better idea of the condition of your home, and will provide the necessary information to create a plan of action moving forward.
Inspectors are hired by the buyer to do an objective evaluation of the property. Keep in mind that no home is going to be perfect and inspectors are simply doing their job, so try to keep an open mind when receiving the results! If you’re concerned about what might be found in the inspection, make a point to obtain your own pre-listing inspection before putting your home on the market!
Pricing High Leaves Room for Negotiations
This is one of the most dangerous (and most common) misconceptions a seller could possibly believe -- especially if they would like to sell their home within a reasonable timeframe. A buyer will not waste their time looking at a home that’s clearly overpriced. So before listing your home higher than its worth to leave room for “negotiation,” just understand that most buyers will know its over priced before ever setting foot on your property. That’s the beauty (and sometimes the curse) of having the internet to compare prices of similar homes in the area.
Enticing optimal buyers with a competitive price from the beginning will create the traction you’re hoping for, and greatly increase the chances of receiving that asking price, if not more!
Dream Home First, Pre-Approval Later
Don’t you just love going online and browsing through all of the houses you see yourself living in one day? Looking at floor plans.. deciding on your “must haves''.. mentally checking houses off your list.. these are all amazing things! -- but if you haven’t been pre-approved for a loan, the only issue here is that you don’t know for certain if the home you’re looking at is within your price range. Of course you have a general idea of how much you’re able to afford, but knowing for certain how much you are qualified to spend is the very first step you should take!
Set yourself up for success from the beginning by getting pre-approved by a mortgage lender. This way you won’t be disappointed by house hunting for something that turns out being way more than you’re approved for. Taking the proper first step will put you on a much quicker route to finally buying the home of your dreams!
Going “FSBO” Will Help You Save
The first thought that comes to everyone's mind when they think of going FSBO (For Sale By Owner) is that they are going to be saving a ton of money -- this is not necessarily true. According to the National Association of Realtors, the “median sales price of a FSBO home was $200,000 in 2018, which is nearly $65,000 less than the median sales price of $264,900 for agent-assisted home sales.” This means that you might think you’re getting a great deal because you don’t have to pay that 5-7% commission for an agent, but without a marketing strategy, extensive sales experience, and industry knowledge, your home may end up selling for far less than what you deserve.
The truth is that everyone wants to get the best possible return on their investment -- but if you consider the median sales price of FSBO homes, and the fact that you’ll likely still have to pay a commission if your buyer is represented by an agent, it all turns out to be about the same. Why not save yourself the headache of doing all the work yourself, and use an agent with industry knowledge and experience?
Start Low When Making an Offer
As sellers overprice for the sake of negotiations -- buyers often do the same. If the home is already priced within range, it’s probably not the best idea to give them a significantly lower offer. This is quite the common misunderstanding, but the only thing you’re going to do here is lose credibility with the seller, and prevent them from wanting to negotiate any further.
Look at it this way: If this is a home you’re taking seriously, then only getting a couple thousand off the asking price leaves you with far more to gain than losing the deal altogether. If the property is accurately priced and you’ve already been pre-approved, then it only benefits you to give the seller a realistic offer!
Every transaction is similar in principle, yet unique in their own respects. Understanding these myths before getting involved in such a process is paramount, and we want to make sure that you’re set up for success! If you have any questions regarding the buying or selling process, or need more information regarding real estate myths, get in touch with one of our agents! They would be more than happy to provide you with the information and resources you need to achieve your goals.
Precision Home Group is based in Anchorage, and provides real estate services to Southcentral Alaska. We will keep you informed on current trends and market dynamics to help you make the best informed decision. If you are interested in purchasing a home, get in touch with our experienced real estate agents! Our team of experts will negotiate great deals for your home and help you navigate the buying or selling process every step of the way. If you are looking to get into a property that makes sense, or need help analyzing a potential property, reach out at 907-302-1011 or email at email@example.com.