How to Buy a Home - Step Five: House Hunt in a Hot Market
Jennifer Shapiro | Apr 8, 2021
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By Jennifer Shapiro on Mar 24, 2021
If you didn’t catch our last blog post on choosing a neighborhood before you start your home search, you can get caught up here. In today’s blog, we take a look at the fourth step to purchasing a home: choosing a real estate agent.
In today’s high-tech DIY world, surfing real estate listings online has become an American pastime. Shopping for a home in your pajamas on your couch has never been so convenient.
But, what happens when you want to see a house in person? And…what if you fall in love with that house and want to submit an offer on the spot? What should you offer? What are the other homes in the neighborhood selling for?
Once you’ve been Pre-Approved or Cash Approved™ and are ready to move from scrolling on Zillow to unlocking the door to your dream home for the first time, you’re going to need the right real estate agent.
Although showing homes is a big part of an agent’s job during the house hunting phase, it’s important that you understand how an agent can help once you purchase a home and it goes under contract. As with any profession, there will be good and bad apples. While an average agent might complete only the minimum requirements to cash out on his or her commission, a good agent will wear many hats throughout your homebuying process including negotiator, problem solver and therapist.
Remember, buying a home is one of the biggest purchases of your life and an agent can make or break your homebuying experience, so it’s vital you pick one who will get you to the finish line.
When looking for an agent, you can use many online tools for research. But don’t dismiss interviewing agents face-to-face to get a feel for how they communicate before making a decision.
Here are some things to keep in mind:
An agent's ability to “pull comps”-a list of comparable homes that have sold within a specified area and time frame is one of their most valuable assets. The ability to argue or defend how comparable sales affect market value of the property will be one of the most powerful tools when negotiating price.
An agent should have a thorough understanding of the housing inventory in the neighborhood you are interested in. They will know what has sold or not sold recently.
Showing homes is a critical part of how agents help you, but an agent’s ultimate job is to close your deal. They don’t get paid unless it closes. On House Hunters, we see homebuyers choosing a house and in the next scene, they’re playing football in the backyard as the credits roll.
In real time though, closing a home can take weeks. There are hundreds of laws, contingencies and deadlines in a real estate transaction to address. There will be a number of people working on your transaction, including a lender, an inspector, a title company, and possibly an attorney . These professionals will make up your homebuying “dream team” and your agent will be the glue.
A good agent will know how to navigate your purchase agreement. They will be proactive in making sure you satisfy all requirements and deadlines from the moment you submit an offer to closing on a home. They will be the central point of contact for the seller’s agent and your dream team.
Need a survey? Need original building plans or copies of permits? Need an extension on your inspection period? Your agent should take responsibility for directing and coordinating all of these processes and people and advise you every step of the way. They will advocate on your behalf when they are legally able and they will know when they aren’t, such as in the case of an appraisal or inspection report. Don’t try to DIY a Realtor’s job. You will need a licensed professional who understands real estate laws and regulations for your state.
Know there will be unexpected challenges on your transaction so hire an agent who is a creative problem solver and can work cooperatively with the seller’s agent and your dream team to close the transaction on time.
A good agent has more than just industry experience and market knowledge. They need to be able to troubleshoot problems cooperatively and effectively with the seller’s listing agent.
Pro-Tip: Understand that only sellers pay real estate agents a commission. Be wary of agents offering discounted commissions upfront for service. An agent’s commission can be negotiable and sometimes an agent will contribute a portion of theirs as a “best and final” negotiation strategy they keep in their back pocket to push a deal over the finish line at the right time and get it closed.
You must be able to trust your agent completely. Feeling comfortable and having chemistry with your agent is something that only you can determine.
Just as important as an agent’s knowledge and experience is their ability to guide you smoothly through a transaction. You can expect bumps in the road throughout your homebuying process, especially in a highly competitive market. You’ll want to work with an agent who is resilient with these setbacks and equally encouraging to get back on it until you close on a home.
Don’t forget: when you pick an agent, you are choosing who will be your primary advocate to the seller and your homebuying dream team. If you work with a good one, your chances of securing your dream home will be much higher!
Jennifer Shapiro | Apr 8, 2021
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