Last week, Everyday Tips, published a nice article on 10 Tips for buying a new home. It got me thinking of the crazy things I’ve done to research and negotiate a property. Don’t worry, I didn’t go and consult any psychics or anything, but now that we have a couple of houses under our belt, we are more bold with our research methods.
Recently, we were looking at our Dream Home that was about to fall into the ocean. I’ll share a few things that we did to figure out if this place was really the disaster it seemed to be on the surface (and the answer was definitely YES).
- Talk to the Neighbors – Knock on people’s doors + don’t be shy. Think about it from their perspective. Wouldn’t you like to know what your prospective new neighbor may be like? People were very welcoming. If you think this is nuts, there were two other people looking at the property and they both came around and spoke to the neighbors as well. It’s not as uncommon as you may think.
- Get Contractors to Quote Major Work – I hadn’t done this in previous homes, but with something like a sea wall, I had no idea how much money to budget for such a repair. The seller’s realtor will almost always accommodate such requests, especially on fixer uppers.
- Check the Registry of Deeds – In many parts of the country, these records are available online. If not, it is a public record and all it takes is a visit to city hall to find out how big of a loan has been taken out on the property. This can help with the negotiation if you know upfront how big a loan has been taken out on a property. It doesn’t tell you how much they owe, but it could tell you if they kept taking equity out of the house by refinancing a bunch of times.
- Ask for Stuff Inside the House – we bought an estate and I negotiated in all kinds of odd stuff like the garbage cans and rakes, etc. They didn’t have a lot of value to the sellers and it saved us a few hundred bucks at the the Home Depot. My mom’s house we negotiated dishes, patio furniture, the works. (also an estate)
- Convince yourself that there will always be a better house – This was a great tip from my brother in law. When they were buying their house, they were outbid on a # of properties (the market was hot back then). We wondered how it didn’t emotionally drain them to have to walk away from so many places they liked. He said he just made sure the next house was better than the last one, so they didn’t feel like they were settling.
- Look at an aerial view of the house on google earth – in our case, my husband looked at the dump house from the ocean. He got a sense of the neighborhood house sizes from his bird’s eye view.
- Do the Math in a different way– the numbers I crunched weren’t “how much house I could afford?” They were more like “how much am I throwing away in taxes and interest/month.” People always talk about throwing money away in rent, but you’re still throwing money away as a homeowner if the cash isn’t going towards principal. This was eye opening to me and that alone might be enough to understand that buying may not be the best option for some.
- Ask your Realtor about properties about to go on sale – a good realtor knows which properties are about to go on the market (at least for their agency).
Good Luck. Let me know if anyone else has done any unconventional research when buying their house.
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I like the idea of trying to get as much sales data as possible, in terms of other homes in the immediate and surrounding areas. I want to know price trends of comps in nearby areas as well.
It’s a matter of having the right context, in order to make a good financial decision.
Squirrelers – yeah, I consider comps to be a given service provided by the realtor. I also like zillow for that as well. The other thing I’ve done is go to open houses for months before I’m ready to buy (not everyone has that option). It gives you a better sense what’s a deal vs just market price.
Good points all.
When we bought I spent months going through the MLS listings in the area to see what housing neighborhoods and trends were. It took a while before I found a real estate page that let me do that, but they exist.
Hello! Thanks for mentioning my post.
I think the key for us was to know the market well in advance of actually being ‘in’ the market. I looked on Realtor.com for months before we were ready to move, and I also went to open houses. When we were finally looking, I knew my house was a deal immediately, just because I was well informed. It also appraised for way higher than I paid for it.
I like the idea of keeping in mind that there are always better houses. My husband and I felt so bummed when we were outbid on a house while we were looking. Now I’m happy we were outbid since our house was way better – newer, less fix up stuff, nicer neighborhood, same commute, etc!
BFS..I like your new avatar.
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