First time home buyers are hurrying to meet the deadline for federal tax incentives and some are making costly mistakes in their haste.  Doing your homework and spending some time with your Summit NJ real estate agent can help you avoid the most common rookie mistakes.  Some of the most costly financial missteps were discussed in Part 1; now we’ll focus on the errors rookie home buyers sometimes make in the actual house hunt.

Focusing on the décor

First time home buyers have an especially difficult time looking past the furnishings of the current owner.   They sometimes forget that dated furniture will be leaving with seller.  They fail to see the actual space and architecture of a home, often rejecting nice homes in great neighborhoods just because they didn’t like paint.  Likewise, don’t fall in love with staging tricks.  Some homeowners will pay for a magazine-quality look that will not be there once you move in.  Focus instead on the aspects of the property that will not change like location, square footage, lot size and school district.

Love at first sight

Rookie home buyers are also notorious for falling in love with homes, getting emotionally attached and suffering heartbreak later.  If you really like a property, visit it more than once and examine it closely.  Research on the neighborhood; don’t neglect the homework.  Even if you think it’s the only one for you, keep looking.  Compare a few other properties and make sure it’s as good as you think.  Try not to get attached until you’ve gotten the inspection report.  That charming historic home could have a cracked foundation or problem plumbing.  Even newly constructed homes can have issues so don’t fall in love too fast.

Blind ambition

Sometimes a fixer-upper with a great asking price is tempting.  Would-be handymen and hopeful “flippers” get excited about the prospect of buying low and selling high after making a few improvements.  Be cautious in your estimation of how much these projects will cost.  You may think the bathroom just need some tile and new fixtures but can you afford the repairs if you find a structural problem?  Don’t overestimate your own skills, either.  Some tasks are best left to professionals, both for the quality of the work and the safety of the home.  Don’t fall into a money pit on your first foray into home ownership. 

Choosing a qualified Summit NJ real estate agent to guide you through the home buying process will help you avoid some of these typical rookie moves.

With so many first time homeowners rushing to complete a purchase before the federal tax incentive deadline, there are bound to be mistakes made.  These “rookie” homebuyers are much more likely to make serious missteps in their purchase.  The worst mistakes, of course, have to do with money.  These common errors in buying can be avoided with planning and foresight.

Failing to finance first

Shopping before you have your financing in place is a common rookie mistake.  Many first time buyers think that they don’t need a loan till they’ve found something to buy but this is not the case.  Getting prequalified for a loan will give you a good idea of the price range you can afford and will keep you from overreaching your budget.  Your offer will be taken more seriously and will usually be given preference over bidders without financing.  Without financing in place, the seller has no guarantee that you’ll qualify to buy the home at all.  Get your budget together and financing in line before you begin to house hunt.

Throwing “low ball” offers

In a buyers’ market, it’s tempting to toss out an offer well below asking price or ask the seller to take on all closing costs and fees.  Many first time buyers try to shop above their budget and make low offers in an attempt to get more for their dollar.  This strategy has been known to produce a great deal here and there, but it’s more likely to get your offer rejected outright.  Too low an offer can be an insult to the seller; they may be unwilling to entertain your follow-up offers.  If you’ve found the home of your dreams, don’t risk losing it by trying to get a bargain basement price.  Ask your Summit NJ real estate agent to check the area comps and help you come up with a reasonable offer.  If you’re going to throw a low ball, you better have a convincing reason for it.

Overbidding

Bidding too low has its dangers but so does bidding too high.  Rookies often get emotionally involved with a house and fight to get it.  The thrill of competition can get the better of a buyer, pushing the price of the home beyond the capacity of the budget.  Don’t get caught in this trap; it only benefits the seller.  Try to maintain some emotional distance until your offer is accepted and the inspection is complete. 

A mistake in this home buying process can be devastating to your family’s budget.  Find a reputable Summit NJ real estate agent to help you avoid these common pitfalls.

It may be something of a buyer’s market right now, but that doesn’t mean every home listed for sale is in foreclosure.  The Summit NJ real estate market has actually weathered the recent storms pretty well.  There are still some short sales and foreclosures in the listings which could be a deal for the savvy buyer.  Many buyers are attempting to make a “low ball” offer, one significantly lower that the asking price.  It’s a risky strategy for all but the most casual house hunters and should only be used if there is a good reason to do so.

If you intend to make a low offer, have a compelling reason.  You should be able to back up your claims and justify your offer to the seller.  You may want to communicate your rationale along with your offer so that the seller knows you’re still a serious buyer.  There are some times when a making a low offer is an acceptable risk. 

Show them the money

If you have enough money to offer the seller in all cash, then you might be able to get away with offering less than asking price.  Some sellers like the idea of one large payment all in cash and will put it to the front of the line, even though it actually makes little difference to them whether to not the money comes from a lender or your personal accounts.  Making an offer with a larger earnest money deposit will make you offer appear more serious and appealing, too.

A home that lingers

If a home has lingered on the market long enough to become stale, the seller may entertain lower offers.  Months of showings and open houses with no results can be disheartening.  Many sellers grow tired of the process and just want to be finished with the sale, even if they won’t be getting the price they first wanted.

The asking price is inflated

Pricing is part art, part science and some sellers just have not set a price that reflects the current market or condition of the home.  Your Summit NJ real estate agent will thoroughly examine the comparable sales in the area and determine what the home is currently worth.  If the asking price is inflated, you can make an offer that is realistic even if it seems low.

Making a low ball offer can be risky, but it can also pay off.  Your realtor can help you decide if this is the right strategy for you.

Though the Summit NJ real estate market has fared well throughout the economic adjustment, buyers still have something of an edge.  This doesn’t mean you’ll lose your shirt if you decide to sell now; it just means you have to be a little smarter than the competition.  If you want your property to sell quickly and at the right price, consider these tips to get you started.

Price it right

Price is the single most important factor in your sale.  Buyers will find something to dislike, no home is perfect, but you’ll be amazed at what they will overlook if they feel the price is right.  Have you agent find out what homes like yours have been selling for in recent months.  This will give you a good snapshot of what the market conditions are dictating.  Don’t price too high, thinking that it will leave you more room for negotiation.  This will eliminate a large pool of you potential buyers who have a maximum number is the heads and won’t shop outside of their budget.  Try to remain objective about your home’s price.  It’s not about the work you put into it, the upgrades you wanted for it or the affection that you have for it.  

Small updates

Little changes can mean bigger profits when you are selling your home.  A few new bathroom fixtures, update lighting and fresh paint can make a home feel fresh and new.  This is not the time for a major construction project or renovation.  You are unlikely to get your money back out of large projects unless you stay in the home for a while to enjoy them.  Instead, think about making small upgrades and updates that will subtly change the look and feel of your home.  Decluttering and staging are always good way to freshen up a home prior to selling.    These are great do-it-yourself projects.  With a little research and elbow grease you can take on staging your own home.

Choose the right agent

Finding a realtor to guide you through your home’s sale is a very important step, one you should not ignore.  Interview a few agents before you make a final choice. You should find an agent with an excellent reputation.  Ask for referrals from friends and neighbors.  Find someone who is knowledgeable about you area and has experience selling homes there.  Look for a realtor with a strong on-line presence as this is where many of today’s buyers start their search. 

Selling Summit NJ real estate in this market isn’t nearly as scary as some would have you think.  If you make a plan to sell smart, you’ll be in your next home in no time.