May 2009

10 Deadly Mistakes

10 Deadly Mistakes Buyers Make

Whether you are looking to buy your first home, or are planning to purchase your next home, it is critical that you consult with a qualified real estate practitioner to help you avoid some of the most common mistakes buyers make. For more information on avoiding home buying mistakes, contact the Hermann Team! The following list is 10 of the most deadly mistakes you need to avoid.

1. Making an offer on a home without being pre-approved.
Pre-approval will make your life easier–so take the time to speak with a lender. Their specific questions in regard to income, debt, etc., will help you determine the price range you can afford. It is an important step on the path to home ownership.

2. Not having a home inspection.
Trying to save money today can end up costing you tomorrow. A qualified home inspector will detect issues that many buyers can overlook.

3. Limiting your search to open houses, ads, or the internet.
Many homes listed in magazines or on the internet have already been sold. Your best course of action is to contact a Realtor®. They have up-to-date information that is unavailable to the general public and are the best resource to help you find the home you want.

4. Choosing a real estate agent who is not committed to forming a strong business relationship with you.
Making a connection with the right Realtor® is crucial. Choose a professional who is dedicated to serving your needs–before, during, and after the sale.

5. Thinking there is only one perfect house out there.
Buying a home is a process of elimination, not selection. New properties arrive on the market daily, so be open to all possibilities. Ask your Realtor® for a comparative market analysis. This compares similar homes that have sold, or are still for sale.

6. Not considering long-term needs.
It is important to think ahead. Will the home suit your needs 3-5 years from now?

7. Not examining insurance issues.
Purchase adequate insurance. Advice from an insurance agent can provide you with answers to any concerns you may have.

8. Not buying a home protection plan.
This is essentially a mini insurance policy that lasts one year from the close of escrow. It usually covers basic repairs you may encounter and can be purchased for a nominal fee. Talk to your agent to help you find the protection plan you need.

9. Not knowing total costs involved.
Early in the buying process, ask your Realtor® or lender for an estimate of closing costs. Title company and attorney fees should be considered. Pre-pay responsibilities such as Homeowner Association fees and insurance must also be take into account. Remember to examine your settlement statement prior to closing.

10. Not following through on due diligence.
Buyers should make a list of any concerns they have relating to issues such as: crime rates, schools, power lines, neighbors, environmental conditions, etc. Ask the important questions before you make an offer on a home. Be diligent so that you can have confidence in your purchase.

Protect yourself from the common pitfalls!

Adapted from Buffini & Company 2007

For Sale by Owner

Buyer/Seller Resources

For Sale by Owner in Texas

REAL Trends, the industry authority on home sales nationally, reports that homes sold using a REALTOR sold for up to 16% more than those without. Surprising?

Homes for sale by owner in Texas will almost certainly not be listed on your local MLS (multiple listing service), and everyone agrees that shoppers do their legwork on the Internet before ever reviewing a home in person. Without exposure on the real estate Websites that receive the lion’s share of shopping buyers, houses for sale by owner miss the majority of the consumers who might consider buying it.

Homes for sale by owner are also prime targets of consumers who do not have the wherewithal to qualify for a mortgage. The first thing a REALTOR does is evaluate buyers for credit stability, in order not to send unqualified prospects into their clients’ home and waste valuable time. As an owner selling their most valuable possession, isn’t that something you’re interested in? People who stop and knock on a Texas FSBO door know that the seller is so eager to sell their home. REALTORS professionally evaluate properties, performing Comparative Market Analysis to scientifically and accurately determine a property’s true value, thereby helping consumers get the most bang for their marketing buck.

RE/MAX is the only nationwide real estate company spending an unprecedented $50 million annually driving consumers to RE/MAX websites. With about one-half of all real estate advertising on national television, regular monthly ads in the most popular consumer magazines, and coast-to-coast radio advertising, RE/MAX attracts millions of customers reviewing homes on the RE/MAX websites.

Homes and Land for sale by owner in Texas cannot begin to compete for this quantity or quality of buyers. As a matter of fact, the real estate industry knows that the majority of homes for sale by owner will list with a qualified REALTOR soon after beginning the marketing process. Why waste the first few valuable weeks learning what others already know? A RE/MAX of Texas REALTOR is your quickest path to selling your Texas home in the shortest period of time, for the best possible price, with the least amount of stress.

Selling Your Texas Home

Buyer/Seller Resources

Selling Your Texas Home

All homeowners can play an important part in the timely sale of their property. By following the guides below, you’ll help Alan sell your home faster, at the best possible price, with the least amount of stress.

The simplest and most reliable way to improve the curb appeal and impression your home makes is to select a qualified Texas REALTOR.  Alan can help you get everything in order-whether making simple repairs, providing a thorough cleaning, or repainting the kitchen-so you can remain focused on more important things.

Make the Most of that First Impression

When selling your home, a well-manicured lawn, neatly trimmed shrubs and a clutter-free porch welcome prospects. If it’s summer, trim the grass and shrubs.  If it’s autumn, rake the leaves.  The fewer obstacles between prospects and the true appeal of your home, the better your Texas home will show.

Invest a Few Hours for Future Dividends

Here’s your chance to clean up in real estate. Clean up the living room, the bathroom, the kitchen. If your woodwork is scuffed or the paint is fading, consider some minor redecoration. Fresh wallpaper adds charm and value to your property, according to most Texas realty professionals. If you’re worried about time, hire professional cleaners or painters to get your house ready. Remember, prospects would rather see how great your home really looks than hear how great it could look “with a little work.”

Check Faucets and Bulbs

Dripping water rattles the nerves, discolors sinks, and suggests faulty or worn-out plumbing. Burned out bulbs or faulty wiring leave prospects in the dark. Don’t let little problems detract from what’s right with your home.

Don’t Shut Out a Sale

If cabinets or closet doors stick in your home, you can be sure they will also stick in a prospect’s mind. Don’t try to explain away sticky situations when you can easily sand them away. A little effort on your part can smooth the way toward a closing for you and your Texas REALTOR.

Think Safety

Homeowners learn to live with all kinds of self-set booby traps: roller skates on the stairs, festooned extension cords, slippery throw rugs and low hanging overhead lights. Make your residence as non-perilous as possible for uninitiated visitors, and follow Alan’s professional advice on showing tips.

Make Room for Space

When selling your home in Dallas or anywhere across Texas, remember that potential buyers are looking for more than just comfortable living space.

Consider Your Closets

The better organized a closet, the larger it appears. Now’s the time to box up those unwanted clothes and donate them to charity.

Make Your Bathroom Sparkle

Bathrooms sell Texas homes, so let them shine. Check and repair damaged or unsightly caulking in the tubs and showers. For added allure, display your best towels, mats, and shower curtains.

Create Dream Bedrooms

Wake up prospects to the cozy comforts of your bedrooms. For a spacious look, get rid of excess furniture. Colorful bedspreads and fresh curtains are a must, according to one Texas realty professional.

Open up in the Daytime

Let the sun shine in! Pull back your curtains and drapes so prospects can see how bright and cheery your home is.

Lighten up at Night

Turn on the excitement by turning on all your lights-both inside and outside-when showing your Texas home in the evening. Lights add color and warmth, and make prospects feel welcome.

Avoid Crowd Scenes

Potential buyers often feel like intruders when they enter a home filled with people. Rather than giving your house the attention it deserves, they’re likely to hurry through. Keep the company present to a minimum.

Watch Your Pets

Dogs and cats are great companions, but not when you’re showing your home. Pets have a talent for getting underfoot. So do everybody a favor: Keep Kitty and Spot outside, or at least out of the way.

Think Volume

Rock-and-roll will never die. But it might kill the transaction for you and your Austin realty professional. When it’s time to show your home, it’s time to turn down the stereo or TV.

Relax

Be friendly, but don’t try to force conversation. Prospects want to view your home with a minimum of distraction.  In fact, it is preferred that you not be in your home when a prospective buyer is viewing your home.  They will be able to speak freely with their representative.

Don’t Apologize

No matter how humble your abode, never apologize for its shortcomings. If a prospect volunteers a derogatory comment about your home’s appearance, let Alan handle the situation.

Keep a Low Profile

Nobody knows your home as well as you do. But Alan knows buyers-what they need and what they want. He will have an easier time articulating the virtues of your home if you stay in the background.

Don’t Turn Your Home into a Second-Hand Store

When prospects come to view your home, don’t distract them with offers to sell those furnishings you no longer need. You may lose the biggest sale of all.

Defer to Experience-It’s the Experience®

When prospects want to talk price, terms, or other real estate matters, let them speak to Alan.

Help Your Agent

Alan will have an easier time selling your home in the DFW area if showings are scheduled through his or her office. You’ll appreciate the results!

Buying Your Texas Home

Buyer/Seller Resources

Buying Your Texas Home

The questions surrounding a house purchase can feel endless, whether you’ve spent years saving and preparing to buy your dream home, or are unsure if you can afford the property you desire.

Here are some tips to help you navigate the road to home ownership…

Hire a real estate professional.

The first step is to select a professional to help you find your dream home and fine-tune your financial expectations. Working with a REALTOR who is a buyer’s agent is worth consideration since he or she is legally responsible for representing the buyer’s interest in a real estate transaction. Before making a decision, however, have your real estate agent explain the pros and cons of using a buyer agent versus a sales or dual agent. Your REALTOR can guide you through every step to buying a home.

Shop for mortgage rates and terms.

A difference of even half a percentage point can mean a huge savings over the life of a loan. For example, the difference in the monthly payment on a $100,000 mortgage at 8 percent vs. 7.5 percent is about $35 per month. Over 30 years, that’s $12,600.

Prequalify for a loan.

Your third step should be to get prequalified, which determines how much you can afford. It allows you to move swiftly when you find the right home, especially when there are other interested buyers. It also indicates to the seller that you are serious and really can afford to buy this real estate.

Define what you want.

The next step is to create a realistic idea of the Texas home for sale you’d like to buy. What features are most important to you? Make two lists: one of the items you can’t live without and one of the features you would enjoy. Refine the lists as you hunt for that special home for sale in Texas. It is also helpful to search online to see what is currently available on the market. Your REALTOR can then show you houses that meet your expectations.

Visit properties.

Now you’re ready to visit houses. Ask your real estate agent to arrange showings, and keep track of the properties you’ve seen.

Know the features that help or hurt resale.

In some areas, a swimming pool actually detracts from a home’s value and makes it harder to sell. In neighborhoods with two-car, attached garages, a single-car or detached garage may impact the home sale and future value. Your REALTOR can point out features that hurt or help resale value.

Rate the houses you tour.

After touring each selected Texas home for sale, write down what you liked and didn’t like. Develop a rating system that will help narrow the field down. For example, pick the house you like best on day one and compare all other houses to it. When you find a better one, use the new favorite as the standard.

Make an offer.

Once you’ve pinpointed your dream house, it’s time to get serious about the financial and contractual side of the purchase. Your REALTOR will be a strong advantage since you and the seller have different goals.

Arrange for a home inspection.

After your offer is accepted, set up a home inspection. It’s common to find problems, including leaky roofs, cracked walls, insect infestations and foundation problems. Your REALTOR can help find a reputable inspector, and will negotiate to get you the most for your money once the inspector’s report is final. If you negotiate repairs as part of the purchase, ask for a “walk through” before finalizing the paperwork. Ask your Texas real estate agent about home protection plans, which may save you money in the near future.

Close.

Before your closing date, make sure you’ve made all necessary deposits and completed the paperwork-including mortgage, title, homeowner’s insurance and any other paperwork required by local or state governments.

Prepare for life in your new home.

Before rolling out the welcome mat, consider some moving basics: arranging for an alarm company, turning on electricity, water and gas, cleaning or replacing the carpet, and notifying your local post office of your new address. The best time for renovations is often before you move in.

Choosing your Real Estate Agent

Buyer/Seller Resources

10 Recommendations for Choosing your Texas Real Estate Agent

As a prospective homeowner, selecting the right real estate agent is critical. Your REALTOR® will keep you abreast of this rapidly changing industry, swings in market conditions, and the availability and demand for property inventory. Your agent also guards your legal interests when facing tough negotiations or confusing contracts.

The safest way to hire a strong real estate agent is to interview more than one specialist. Here are 10 tips to guide you:

Identify at least three (preferably five) real estate professionals.

• Look around your neighborhood. Is the same for-sale sign in every other yard? Call this REALTOR® and arrange an interview.
• Use the Internet. It’s easy to search for an Dallas area REALTOR® online.
• Ask a neighbor or friend. Who helped them buy their home? Which real estate agent in Dallas would they hire if they decided to buy?

Interview the real estate professionals you have identified. Having a conversation with the person is a good way to find out if your personalities and goals match. Here are things you want to ask:

• “Are you a REALTOR®?” You will have the best luck finding the right home if you work with a REALTOR®, not simply a real estate agent. REALTORS® are members of the National Association of Realtors. They are generally full-time agents who have committed financially, educationally and professionally to being an expert in the real estate industry.
• “How often will you notify me of new listings?” In some Texas markets, houses enter the market and sell within the first hour. You need a REALTOR® who is serious about finding a home you’ll love. Buyers should expect to hear from their agent whenever a home matching their description appears on the market.
• “How often can I expect to hear from you?” Just because your dream house isn’t on the market yet doesn’t mean you won’t have questions. Be sure to work out an arrangement with your REALTOR® from the beginning.
• “How quickly can I expect you to return phone calls?” You don’t want to be ignored. If the REALTOR® doesn’t have a callback policy (“You’ll hear back from me within two hours/30 minutes/before the day ends”), you may not get the service you expect.
• “Are you a full-time REALTOR®?” “Hobby agents” aren’t as capable of meeting your expectations because their attention is divided by other responsibilities. Limit your search to full-time real estate agents.
• “Who will you represent in my real estate transaction?” Depending on local laws, the REALTOR® representing you may be a subagent for the seller (not what you want as a buyer). Find an agent who can truly represent your interests without having to bow to another client. You may want to consider hiring a Buyers Agent.
• “Will you give me your honest feedback?” Avoid “yes-men.” If you can’t find your dream house because it simply doesn’t exist at the price you’ve quoted, you need more options. When you find a strong real estate agent, you get more out of each meeting.
• “How long have you actively worked in the area?” While the answer to this question shouldn’t necessarily be a deal-breaker, a REALTOR® who has worked in the area a long time may be more aware of properties that match your description.

Compare interview notes.

Think about each agent, and decide which one is right for you. You should choose someone aggressive, but who doesn’t make you feel anxious or pressured.

Experience pays.

Experienced real estate agents often earn designations that separate them from the pack. These designations are earned through training that helps the agent become a specialist in certain areas. Pay attention to agents who have designations listed after their names on business cards. Specifically ask the agent what each one means.

Find a REALTOR® who is savvy about technology.

Through the online tools available to agents these days, you can expect nearly immediate e-mails about new property listings and quick replies to your queries.

Ask for references from your Texas REALTOR®.

This shouldn’t be a big deal; it’s a last-step investigation that could confirm or reject your impression of the agent.

Before signing a contract, know that the term “Disclosed Dual Agent” often means that the real estate agency does not represent your interests 100 percent.

Try using a Buyers Agent to represent you.

Buyer agency agreements are common, but be careful.

What if the REALTOR® doesn’t follow up with you? What if you don’t get along? What if the agent doesn’t understand your needs? Remember that a buyer agency agreement is negotiable, and you can help negotiate the specific terms.

Select a strong negotiator.

Ask your REALTOR® whether he or she has ever been in a tough negotiation and how he or she negotiated a fair price.

Talk money.

Usually the seller foots the bill for a real estate professional’s commission, but don’t assume this will be the case.  Ask point-blank what your financial obligations are throughout the process. Your real estate agent has the knowledge and experience to provide you with a smooth, hassle-free transaction.