There is always a lot of buzz around real estate and what you may hear is not always in line with reality! I’m setting the record straight on six common real estate misconceptions.
1) You Don’t Need to Get Pre-Approved Until You Find the Home You Want
Don’t get burned by this mistake! You need a pre-approval to understand your budget. Plus, sellers typically will not seriously entertain offers without proof of financing and you risk the home selling to another party before you have the chance to get your pre-approval together. Always get pre-approved before you get serious about your search.
2) You Need A 20% Down Payment To Purchase a Home
While true many years ago, today’s buyers can finance a purchase with as little as 3% down and 13% is the average down payment. A hefty down payment doesn’t need to stand between you and homeownership!
3) Spring Is House Hunting Season
The best season for you search for a home depends on your priorities. While the market is always changing, it’s common to see that Spring and Summer will bring a lot more homes to choose from, with those homes typically selling for top dollar with terms in the seller’s favor. Conversely, there may be fewer home to choose from in the Fall and Winter, but buyers often see less competition and have better leverage in negotiations.
4) For Sale By Owner or Using A Discount Agent Saves Sellers Money
While paying little or no commission sounds nice, when it comes to real estate, you get what you pay for. A discounted commission doesn’t mean anything if your home’s price is 10% lower than it could’ve been if you worked with a skilled agent with the proper knowledge and resources to price, prepare, and market your home. For most people, it’s not worth risking the equity of their greatest financial asset.
5) Price High to Sell for the Most Money
This is one of the biggest mistakes sellers make. List too high and you won’t get the traffic of potential buyers. No showings = no offers. This strategy runs the risk of your home sitting on the market and the longer a property sits, the more negotiating power buyers assume they will have. Price in line with the market and you’ll have the best chance of getting multiple offers competing to be accepted, driving up the purchase price and netting you above market value.
6) If A Home Looks Great, You Don’t Need An Inspection
While it is true that there are times it may make sense for a buyer to choose to waive an inspection, it’s always my recommendation to get one. There could always be potential problems that are not obvious, and you don’t want to be stuck with them once the keys are in your hands. Without an inspection, you’ll have no idea what kind of issues and expenses are waiting for you until the problem is all yours.