Frequently Asked Real Estate Questions

Buyer FAQ

Should I get my own Agent or use the Listing Agent?

No one that could ever be involved in your transaction is in quite the same position as your own agent. They can and will give you all information good or bad in order for you to make the best decision. When you have your own agent, there’s no incentive for the agent if you buy a certain house.

What should I know before making an offer?

As far as the property is concerned things like the history of the property, length of time on the market, any flood zone issues, and any known defects or adverse conditions are good things to know. As far as other information you should have an idea of costs associated with the purchase such as closing costs, insurance premiums, homeowner’s association dues, taxes, and house payments.

What are legitimate reasons for voiding a contract?

Any information that becomes known to the purchaser during their inspection period that either changes the way they feel about a property or that they consider incurable are enough to void a contract. Keep in mind that if discovered during the inspection period the buyer doesn’t even have to provide a reason although it’s probably the decent thing to do. Good agents who communicate well go a long way in preventing these situations.

What is considered Breach of Contract?

Plain and simple, breach of contract is acting against the provisions already established on a contract. If the contract says it is subject to the buyer getting a mortgage and they cannot, this is not breach. If the contract is subject to the appraisal meeting the sales price and it does not, this is not breach. If the contract is subject to a satisfactory inspection and the buyer is not satisfied, this is not breach. Acting in bad faith or not doing something you indicated in writing as doing is considered breach.

What is the best way to choose a lender?

Choose your lender by looking at a list of all their charges not simply the rate. Also, consider the service end of it. Getting a return phone call is nice, especially on the weekend or after business hours. And some lenders retain their mortgage therefore you’ll likely be dealing with one person throughout most of the life of your loan while others sell your mortgage so you may not know who you’re dealing with and they may not have much of a connection with you.

How do FSBO Properties work?

Like a game without rules. Or one that the rules get made up as you go along. Here’s the deal: people typically are so nice as long as your actions benefit them. But once your interest conflicts with theirs, you can see a different person. Agents keep people on track even when situations become difficult by providing good options and positive communication. Most people don’t like confusion when dealing with their money or time and how can they not be confused when it’s something that they never do? The real issue is that people don’t know what it is that they don’t know and this can increase the liability for the buyer.

Seller FAQ

What’s the definition of a true comparable?

Properties that had they been available to the buyer looking at your home, that buyer would have seriously considered. A comparable is one that closely matches the subject property in size, site, condition, amenities, age, and function.

What is the best way to handle a multiple offer situation?

Let all parties know that all parties exist and ask them to resubmit another offer stating this as their highest and best by a certain date and time or they can take their chances with how their current offer stands. Bottom line is everyone should be on the same playing field.

Is it better to make an allowance for repairs or go ahead and to them prior to putting a home on the market?

It really depends on the repair but in most cases sellers are more likely to receive a higher offer in a shorter time having done the repairs/improvements prior to putting the home on the market. For example new flooring would likely make more of an impact on the buyer than seeing a dollar amount the seller is agreeing to pay in lieu of. And this way the seller controls what that cost is.

At what point during the transaction can I assume we’ll get to the closing table?

The first two or three weeks of the transaction is typically the buyer’s due diligence period. After that point, you can start packing because it’s likely that your sale will happen. A good agent does go a long way to making sure all major conditions are handled in a timely manner.

What do Appraisers consider when determining value?

Usually the first thing consumers think of when looking at value is living area. Although this is a major factor in the valuation, living area alone does not tell the whole story. Other important factors are bedroom and bathroom count, condition, quality of construction, functionality, car storage, porches, exterior improvements and site. The role that each of these features plays in the valuation process is determined by researching the value the market places on these features, which can change from one market to the next. One way to determine the value of a given feature is called Paired Sales Analysis. This is process is taking two similar sales, one with a particular feature and one without, and the difference in sales price would be the market value for that feature. Site differences can be determined by researching lot sales in a development prior to construction to establish value differences.

Do I need an appraisal before putting my home on the market?

In most cases you won’t need to go through the trouble of getting a formal appraisal in order to determine the asking price. Especially if there’s good comparable data available. If not, or if the house is “unique” (which is slang for difficult) then perhaps a more involved approach to pricing is necessary. Occasionally, if the listing agent and seller are in different positions as far as price then the agent might recommend that the seller get an appraisal. This is sometimes a good idea so that the price issue comes from someone other than the agent.

Should I use the “Neighborhood Specialist”?

It’s hard to believe that a seller’s marketability goes up simply because of using the “neighborhood specialist” rather than another well qualified agent. The truth is, all agents have access to the same information and just because one agent happens to live in or has sold the majority of listings in a certain development doesn’t mean they are more qualified to be your agent. And it certainly doesn’t have any affect on the buyer. Agents will try anything to set themselves apart and there’s nothing wrong with this, but it doesn’t really mean anything. I’m guessing the neighborhood specialist also will take business outside of their specialized area so perhaps that says something.

Don’t I loose control once I hand my property over to an agent?

The way we see it, you gain control because of the quality of information that becomes available to you. You’re the captain of the ship, your agent is only the navigator.

What’s the best thing to do when a house is not selling?

You must first determine what’s the problem: it’s house related, market related, or agent related. This should be an easy thing to figure out. If people are coming and not buying, you’ve got a house problem so either work on price or condition. If people aren’t coming at all it could be one of the other two reasons. Talk to your competition and see how every detail of your listing compares to others on the market.

When is it time to change the price?

There’s never a time factor here. It’s simply when enough people have seen your home and passed on it. Usually six to ten real buyers (consumers scheduling a private viewing with their own agent, not an open house tire-kicker) is enough. Regardless of whether that takes three days or three months, that’s when you should think about changing the price.

When should I consider a contingent offer?

So many questions in Real Estate are hard to answer definitively. This is one of those cases. It really just depends. Maybe you haven’t received that much activity since it’s been on the market and the buyer has a very saleable home which research shows should take less than 30 days. Maybe the buyer is worth the risk. There’s lots to consider here but the best advice regarding contingent offers is to at least make sure a reasonable amount of non-contingent buyers have passed on it.

“Thank you so much for the excellent work in finding us a home as well as the workmen you put us in contact with. We thank you mostly for your true friendship and your kindness.”

Nancy and David Gillett

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