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Like it or not, every buyer needs to do their homework before making an offer on a property. Most of the time, this due diligence means asking the right questions. That way, you can get the information you need to put together a strong offer that’s fair to both you and the seller. With that in mind, here are five essential questions to ask when buying a house. Make sure to get them all answered before you sign on the dotted line!
1. What are homes in the neighborhood selling for?
When it’s time to decide on an offering price, it’s often a good idea to look at other home sales for reference. Your real estate agent can help with this by pulling up some comparables, which are similar homes that have sold recently in the area. Once you have those in hand, you can use them to determine a potential price range for your offer.
As you look at the other properties, ask yourself: how does the property you’re potentially buying compare? For example, if the property has additional upgrades relative to its comparables, the odds are that the seller will be looking for a higher sale price. On the flip side, if the house needs more TLC, you may be able to get away with submitting an offer on the lower end of the spectrum.
2. How long has the home been on the market?
Time on market is another factor to consider when making an offer on a house. The number of days on the market can give you an idea of the seller’s willingness to negotiate on the purchase price. Put simply, the longer the home has been on the market, the more likely they are to be flexible with their home sale bottom line.
When their home first goes on the market, the seller is often optimistic. If they receive a lower offer early on, they’re likely to pass it up in hopes that something better will come along. However, if the home has been sitting for a while without much interest, the sellers are probably itching to get things rolling. In this scenario, you may have more luck with scoring a deal.
3. How old are the home’s major systems and utilities?
When you’re looking to buy a home, you should always ask about the condition of the property’s major systems and utilities. These features include the roof, foundation, HVAC, and water heater. As the future homeowner, you need to know if something needs to be repaired or replaced soon.
The reality is that major repairs often end up costing thousands of dollars. If you discover that a feature of the home needs repairing right away, you could reflect that in your offer. Alternatively, you make an offer that’s contingent on the seller making the repairs themselves beforehand.
For example, let’s say that the roof on the house you’re looking to buy is almost 20 years old and is nearing the end of its “lifespan”. You could potentially lower your offer amount by a few thousand dollars with the intent of using that money to have it replaced. Or you could save yourself the hassle and request the seller to replace the roof before you buy the house.
4. Is this property a short sale or foreclosure?
Some buyers, especially first-time home buyers, tend to be attracted to short sales and foreclosures because of their lower-than-usual price tags. However, what they don’t realize is that the lower price comes at a cost of its own. With short sales and foreclosures, you won’t be negotiating with the seller. Instead, you’ll be working with the financial institution that has taken possession of the house.
Ultimately, the bank is selling the house to recoup its losses. That means that you’ll have far less flexibility than you would with a traditional sale. For example, while you can do home inspections for your own benefit, it’s unlikely that the bank will be willing to cover the cost of any repairs. As a result, you’d essentially be buying the home as-is. It’s also unlikely that you can get a seller concession to help cover your closing costs, which is often possible in a traditional sale.
5. Why is the seller looking to move?
Though it may seem a bit personal, one of the best questions to ask when buying a house is, “Why do the sellers want to leave?” In most cases, you’ll get a reasonable response like the seller is relocating to a different city for a new job, or the seller is moving on after living in the home for 50 years.
However, the seller’s answer can sometimes give you a glimpse of problems with the home or its surrounding area. For example, if the seller is moving to have more space for their kids, you and your family may also have the same issue with the home. Their response could also tip you off to problems beyond the house itself, such as the neighbors, school district, or crime rates.
Buying a house? Final thoughts
If you’d like to buy a house without the stress, consider working with Orchard. Our Move First service gives you the freedom to buy your dream home without your current home sale holding you back. Our Home Advisors will help you find your family’s dream home, answering any questions that may come up along the way.