Although open houses or individual showings are not a necessity in the settlement process, it is heavily advised that all buyers see a home before making an offer. Many people would argue that with today’s technology, including virtual tours and videos, the need for a viewing is eliminated, but what you see on the Internet may not be what the house actually looks like. Taking photographs and videos at certain angles can often make areas seem larger and it is unlikely that the seller and their agent will post any photographs of flaws in the house. As the buyer, it is often up to you to hunt out the good, the bad, and the ugly when it comes to homes on the market. This is most easily done through open houses and viewings. These viewings will also let the seller know that you are serious about potentially making the purchase, while also giving you the opportunity to ask the important questions. But which questions should you be asking?
The very first question you should ask the listing agent when viewing the home is “why are the owners selling?” The answer may be very simple and understandable. Maybe they are expanding their family and need more space. Maybe they have just retired and want to downsize into a home more suited for empty-nesters. Or maybe they simply want a change of scenery. If you notice that the listing agent is hesitant in their answer, they maybe withholding the real reason. This however, is to be expected as their loyalty lies with the seller and they also want to sell the home for as much as possible. It is important to always take the answer to this question with a pinch of salt.
If the listing agent has been hesitant and you think there may be something wrong with the home, this next question should clear things up: “Are there any problems with the home?” If there are any code violations or structural problems with the home, most states require the agent to disclose the information to potential buyers. In addition to asking this questions, buyers can, and should, also request a written seller’s disclosure from the agent. This form contains everything that is known about the home, including any issues. Asking this question will allow you to gain insight to some problems that might not be clear to the naked eye.
Asking the listing agent “how long has the home been on the market” will give you a good idea of what your next move as a buyer should be. If the home has been on the market for a while that gives you some bargaining power and you may get the home for less than the listed price. If it hasn’t been on the market for long then chances are that the seller will not be willing to drop the price just yet.
If the home has only been on sale for a couple of weeks you need to find out how much interest it is gaining. To do that, you should ask “have there been any offers on the home?” Listing agents are very unlikely to be hesitant about this answer, especially if there have been several offers, as they hope for a bidding war. Understanding what type of offers have been made and at what prices can help you decide if the home still fits your budget and what sort of financing you will need in order to compete.
If the home has been on the market for a while it is important to ask “have there been any changes in the price of the home?” This will let you know if the price is open to negotiation so you can get a good idea of what your offer would be. If you find that there have been several price drops, it may be time to dig a bit deeper. Price drops imply that something may be wrong with the house and it may be something that other buyers have seen that you have not. Ask your own agent for advice if this is the case.
If you are hoping to upsize from what you are currently living in, one huge cost that may not be at the front of your mind is utilities. Typically a bigger house will pay more in electricity costs as there is more space to heat and cool, in addition to more lights and sockets. Asking the agent “what are the average utility costs” will likely save you a shock when you open that initial electric bill.
Finally, it is important to ask “what is the seller’s timeline?” If you do not need to move immediately, this question may not be quite as important for you but for buyers who are on their own strict timeline, knowing when they could move in is crucial. The seller’s timeline will also give you an idea of how willing they may be to negotiate. If the seller needs to move out soon then there is a good chance you could get a price drop, if they aren’t in a rush then they will probably be willing to wait for someone who will offer near or above the asking price.
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