If you’re considering bidding on a property without first seeing it for yourself, you should take precautions. Here are five things you need in order to minimize your risk if you want to buy a house sight unseen.
1. A reliable realtor
If you can’t visit the house yourself, you’ll need to rely on a real estate agent to assess the property on your behalf. Take the time to find someone you trust and who knows the market well.
2. A concrete wish list
Without an in-person impression to tell you if the house feels right, you need a clear and detailed list of what you want in a home, from the floor plan to the finishes.
3. A live video walk-through
Schedule a video chat with your realtor at the house so you can ask about creaky floors, dampness, odors, signs of wear, and other features that don’t show up in photos.
4. A general idea of the area
Use Google Street View to scope out the neighborhood. Also make sure to research local schools, public transit, and other amenities.
5. A full home inspection
A thorough assessment provided by a reputable professional is crucial if you want to buy a house sight unseen. Make sure to add a contingency clause to your offer if you plan to make your bid before the inspection.
Once you’ve found a house that checks all the necessary boxes, speak with your real estate agent about the option of having a virtual closing.
What every first-time homebuyer should know
Buying your first home can be both exciting and intimidating. It’s a major investment, and there’s a lot to consider. However, keeping certain things in mind can make it easier to navigate the process.
To start, it’s important to understand that there’s no such thing as the perfect home. Most buyers prioritize price, size, and location, but you’ll likely need to compromise on at least one of those things. Make sure you distinguish between your wants and needs and remember that renovations can be an affordable way to make a home more to your liking.
Before you consider compromising on your wish list, however, you need to know what you can afford. As a general rule, your housing expenses (mortgage payments, taxes, and insurance) shouldn’t exceed 30 percent of your monthly gross income. You also shouldn’t put all your savings toward a down payment.
For an accurate assessment of your financial situation, it’s best to apply for a mortgage pre-approval. Alternatively, a loan from the Federal Housing Administration can be a great option for first-time homebuyers, as the qualification requirements aren’t as strict as for a traditional mortgage.
Finally, remember that a trusted real estate agent who knows the local market can be an invaluable partner in buying a home. To find a good match, do your research and interview at least two or three realtors before you hire one.
Ask the Expert: Should we wait and save more money for a down payment, or buy now while interest rates are low?
There are a lot of variables to consider when purchasing a home, and the size of a down payment is just one of them.
But to start there, the down payment amount can vary considerably. Traditional guidelines recommend putting 20 percent of the purchase price down, but in practice, that doesn’t always happen.
So if you are in the market to purchase a $250,000 house but don’t have access to $50,000, you still have plenty of options. If you do have 50k to put down, however, it can make your path faster and easier.
Some loans, particularly those aimed at first-time home buyers, allow for down payments of less than $1,000! Other products also allow a buyer to put down less than 20 percent — in that case, you’d pay a small additional cost via private mortgage insurance, or PMI. PMI is calculated as a percentage of the overall loan, usually between a half and one percent, and can be removed when the buyer pays down enough of the principal or accrues enough equity in the property.
Of course, interest rates are an important factor, and it’s true that interest rates on mortgages are at historic lows. A 30-year fixed rate is right around 3 percent, while a 15-year fixed rate is about 2.25 percent.
There has also been less inventory and a lot of competition lately, which drives prices up. This is not positive or negative; as a buyer, you want to make sure you get a good deal and also that you can afford your monthly payment. If more properties come onto the market, even more foreclosures, you may still wind up with a similar monthly payment if interest rates rise. So the decision on timing is uniquely yours, and it’s important to ask yourself what you’re looking for as well as how long you plan to stay.
If you’re renting, consider how much your rent is expected to increase in the coming years. Are rents high in your area or are they more affordable? These factors affect your ability to save money for that down payment.
Each person’s situation is unique, and a professional can help you decide on the best timing and strategy.
3 effective tactics to win a bidding war
It’s not uncommon for properties to receive multiple offers and sell above the asking price, particularly in a sellers’ market. If you’ve found your dream home, but the competition is fierce, here are three strategies that can help you win a bidding war.
1. Make a cash offer. If you have the means, offering to pay for a property in cash shows the seller that you’re serious. It also promises the seller a quick, smooth transaction since a lender won’t be involved.
2. Waive the financing contingency. A seller will be more likely to accept your offer if it doesn’t hinge on loan approval. This is why getting a fully underwritten mortgage pre-approval is a smart first step for prospective homebuyers.
3. Submit a personal letter. This can help you stand out from a crowd of potential buyers and create an emotional connection with the seller. Briefly explain what you love about the property and why you think it’s a perfect fit for your family.
Depending on the situation, you might want to use a combination of these tactics. Keep in mind that working with a local real estate agent to craft a strong offer can significantly increase your chances of success.
Warren County Market Report – April 2021 with Jen Avery
Number of sold properties is high and values are up, but we still need more inventory. Watch this video for a quick summary of Warren County real estate for April 2021. Charts demonstrate the changes in the market, so be sure to click play!
In general summary:
- New Listings are UP 11.9%.
- New Pending UP 45.7%.
- Closed sales are UP 37.5%
- Average Median Sold $312,000
- Average Days on Market 19
*If you would like a copy of this report emailed to you, please send request to firstname.lastname@example.org.
Resource: April 2021 Market Stats by ShowingTime
Bright MLS: Statistics calculated May 2021
Jennifer Avery, REALTOR® “Your Happy Home Expert!”
BPOR, SRS, CNE, E-Pro Certified | Licensed in VA
email@example.com | 540-683-0790
CRUM REALTY, INC| 318 S Loudoun St, Winchester VA 22601 | 540-662-0400
8 essentials allies in any real estate transaction
Are you planning to buy or sell a home? If you want to make sure everything goes smoothly, rely on these professionals.
In any real estate transaction, protecting your legal interests is a must. A lawyer will review contracts before you sign them, draft key documents, manage financial transactions and keep you informed about all important legal matters.
2. Real estate agent
A realtor’s role is to advise and guide you through every step of the real estate transaction. An agent will arrange visits, answer your questions and direct you to trusted professionals as needed.
Using a variety of proven methods, an appraiser will formulate an objective opinion as to the true value of a property. This is important to know if you want to price a home or make an offer on one.
4. Land surveyor
This professional will issue an improvement location certificate, which includes a plan or illustration of the property’s physical features and a written analysis detailing the surveyor’s concerns. This document provides an accurate representation of the property.
5. Home stager
If you want to quickly sell your home, presenting it in the best light possible will ensure the property gets noticed. A home stager will provide you with invaluable advice about how to make your home appeal to potential buyers.
6. Mortgage broker
Acting as an intermediary between you and various lenders, a mortgage broker will help you secure a loan that provides advantageous terms and meets your needs.
7. Mortgage lender
If you want to buy a home, you’ll probably need to get a mortgage. Banks, trust companies, credit unions, and other institutions offer this type of loan. Additionally, getting pre-approved for a mortgage allows you to know what you can afford.
A home insurance policy protects your investment by providing you with compensation in the event that your property gets damaged or destroyed. In this way, your insurer can offer you peace of mind.
What all homebuyers should know about flooding
It’s not hard to find out if the home you’re interested in buying is located in a flood zone. Simply ask your realtor, or visit the online Federal Emergency Management Agency (FEMA) Flood Map Service Center and enter the property’s address in the search bar. However, there are a few things to keep in mind before you decide whether to buy a particular home.
Flooding can happen anywhere
You don’t have to live in a designated flood zone for your home to be at risk of flooding. In fact, flooding can be the result of melting snow, burst pipes, tornadoes, hurricanes, construction issues, blocked storm drains, or problems with municipal sewer lines.
Maps don’t tell the whole story
Even if the home you want to buy isn’t in a designated flood zone, it might still be affected by seasonal changes to water levels in the area. Furthermore, these maps don’t necessarily account for trends driven by climate change such as rising sea levels and extreme rainfall.
Mortgage lenders may require flood insurance
If a property is in a FEMA flood zone that’s considered high-risk, homeowners may need to get flood insurance coverage before their lender agrees to grant them a mortgage. This is true of Fannie Mae, Freddie Mac, USDA, and VA loans.
If you’re applying for a non-government loan or the home is in a low-risk area, you probably won’t have to purchase flood insurance to secure a mortgage. Nonetheless, getting this type of coverage might be recommended.
The National Flood Insurance Program (NFIP), which is administered by FEMA, provides most residential flood coverage in the United States. In places where the NFIP is unavailable, homebuyers may be able to purchase flood insurance from a private insurer.
All homebuyers should be aware of the potential risks of flooding. The best approach is to do your research, ask pointed questions of the sellers and their neighbors, and spend time in the area. Additionally, working with a local realtor is a huge asset.