Paul Dziedzic’s Blog

I have read a lot of articles on what buyers must do and or need to know when buying a home and thought I would give some of my own advice as well on this subject.

No matter if you are buying your first home, or your twentieth, this advice will apply.

1. Know what you want and more importantly, what you need! I have seen too many young couples buy a small home, only to sell it less then a year later. Why? You guessed it, they did not plan on the little ones coming along and sell, usually at a loss, (especially in this market we are in) to buy a bigger home or to move closer to Mom, to help out with the new baby. PLAN AHEAD!
2. Check the selling prices of comparable homes in the area you would like to buy in. Most website will recommend using a website like Zillow or Homegain. Both good websites, in fact I advertise homes on Zillow myself. However, they would have you believe doing comparables is a science. It is not, it is an art! Zillow uses local tax records for comps and I’m pretty sure Homegain just forwards your request to a random Real Estate Agent, not necessarily a Realtor – which is what you want, a Realtor. The problems with just going by tax records are numerous. There is a home in the development I currently live in, that the tax records show as a one (1) square foot home. Yes, the home, in accordance with the county tax record, is only one square foot big. My dog house is bigger then that! Also the tax records do not know what homes sold cheaply because they were Short Sales, foreclosures, HUD homes or dare I say it, are just plain dumps, so this is not factored in to the comps. Also it can not use common sense to know why a home that was listed for $250,000 sold for $260,000. Did the buyers get up grades (normal in new construction)? Did they add the closing costs to the mortgage? Not used as much any more, but still around, did the sellers let the buyers use a program like Amera-Dream, where the offer is higher than the asking price so the seller’s will pay all of the buyer’s closing costs? All the above and more, can cause over inflation of a homes price. The BEST way to get a comp for a home is to hire a Realtor! The best part is, this costs you NOTHING! The Buyer’s agent gets paid from the sale of the home – my next Blog will address just how this works.
3. Know your budget and YOU determine how much house you can afford. That’s right, only you know what you can or can’t afford, as far as monthly payments. Of course, your mortgage company, bank or credit union would have to agree with you, but once YOU come up with a number you can live with, DO NOT let the mortgage company, bank or credit union talk you into more. This is one of many reasons we are in the housing mess we are in today. The best rule of thumb that has worked for centuries is – Spend no more than 28 percent of your income on a home. Stick with this and you should be ok.
4. Know the total monthly cost of owning that home. Ninety percent of all articles I read will tell you, the home buyer, to do your homework to dig up this information. Once again, hire a good Realtor and they will do this work for you. Not only will they give you a pretty good idea of what the property taxes, and homeowners insurance will be, they can usually get you a copy of the annual utility costs gas, electric & water. Now, with all that said, when you first start out looking at homes with a Realtor, and give him or her a list of homes to look at, they are not going to do this on every home you want to see. But once you narrow your choice down to one or two homes you are seriously thinking about making an offer on, they should have no problem doing this for you. This is a part of their job.
5. Know the Closing Costs. Ok, you found a home you would like to make an offer on. This home meets your needs, you have good comps, you know you can afford it, you know the cost of owning that home, but what you do not know is just how much you will need for closing costs. Once again, most articles will tell you how to do all the calculations, however, once again a Realtor will do this for you! They will prepare for you an Estimated Buyer’s’s Closing Cost sheet with the breakdown of all closing costs you will need to pay. They will also let you know which of your closing costs you can try to negotiate to have the Seller pay for. Once again, this is part of their job.

As you can see, a Realtor does more then just drive people around to look at homes. They also do much more then listed above.

I work with a network of Realtors in North America, this includes Canada as well. If needed, I can put you in touch with some of the hardest working Realtors for your area — just send me an e-mail

Paul D. Dziedzic

Realtor

pauld-kw@hotmail.com

www.pauld-kw.com