Thinking about buying in today’s market?

So, every once in a while the Lincoln News Messenger asks me to write an article related to the real estate market here in Lincoln, CA. This is a draft of what I will have coming up in next week’s News Messenger:

Thinking about buying in today’s market?

Right now is a great time to buy. Prices have gone down dramatically and interest rates are still low. There is still a lot of inventory and many great opportunities, but there are some things you should think about before the excitement causes you to make a mistake. Here are some of the things you should consider:
• Hire a professional. Although there are many good websites that give you access to numerous home listings, you should hire an agent who will work for you. Hire a professional agent that knows the area well. The agent can help you in terms of location and will have information about the area including school boundaries, proposed construction, HOA’s, special assessments etc. It is worth not only having someone who knows how to negotiate but also someone who will know everything about the area.
• Be prepared with a loan preapproval. Most real estate agents can give you good recommendations of loan officers who are experienced and can get the job done. You need a loan officer that will educate you and help you understand the different loan options that are available. Although you may be hearing that it is a “Buyer’s Market”, the competition is stiff and you must be prepared to act quickly after a home comes on the market if you want a chance to purchase. Almost all sellers will require a preapproval letter with an offer.
• Choose a target area and type of home you want to buy. After you know which area you think you want to be in, spend some time driving around the neighborhood on different days at various times during the day. What may seem to be a quiet neighborhood at 2:00 pm on a Tuesday afternoon may be totally different on a Friday evening. Talk to the neighbors and ask them how they like the neighborhood. Speak with your agent about the characteristics that you want in a home. A good agent will listen and won’t waste your time showing you homes that you don’t want. Create a detailed list of needs and wants.
• Understand the process. A good agent will sit down with you and help you to understand the process from start to finish. Become educated and don’t be afraid to ask questions. Know the difference between buying a short sale, bank-owned or traditional sale and the possible challenges of each. At your first visit with your agent, you should strategize with the agent and come up with a game plan for finding a house. Talk with the agent about how you will communicate, best times for you to look at homes and let the agent know what you expect. Also ask the agent what he or she expects of you as a buyer.
• Don’t get frustrated. The process can be challenging. You may get beat out on offers and there may be some disappointment. If your offer gets rejected, talk with the agent about why it wasn’t accepted and use the experience to give yourself a better chance on the next offer. Buying a home is an exciting time and should be a good experience. Have fun with it.
• Start thinking about home inspectors and other contractors that can help you either during the process or after you buy the home. Once you are in escrow and the appraisal has been done it is a good idea to have a professional home inspection. This can let you know what will need to be done right away and what things you may want to think about having done in the future. On a regular sale you could ask for things to be repaired. The cost of a home inspection can usually be recouped through the repairs you ask to be done or at the least let you know what needs to be done. It can also save you from making a big mistake.
This is just a short list of a few things you may want to think about as you start the home buying process. The experience should be fun and exciting and a lot of the stress can be alleviated by hiring people who are competent and have expertise in the various aspects of the process. Don’t take the process lightly. You must do your homework, become educated and you will be able to make what is usually the biggest investment in your life.