If you are in the market to buy a house, the first thing you should be concerned with is how to get a good deal on a house. Buying a house is more than a place to live. A house should be viewed as an investment. One of my favorite financial gurus, Dave Ramsey, claims a house to be the only good debt anyone should ever have. A real estate purchase can be one of the largest financial decisions you may ever make, but before you move forward it’s important that you know how to get a good deal on a house. The memories and all the fun things you envision occurring in that house are exciting, but trust me, they all be washed away when you find out your home buying venture was not quite the investment you hoped.
Here’s the first thing to do if you want to know how to get a good deal on a house.
How To Get A Good Deal On A House Step 1-Watch the Hot Sheets
The good deals go fast. Did you ever notice that many of the “good” houses you see online have already sold? Well that’s because it was priced well and everyone else was thinking the same thing. When a property first gets listed on the market everyone takes notice of it and rushes over to see it. If it’s priced well it should go as long as it’s marketed correctly.
I like to tell everyone this. “You will pay more for something you feel will be gone tomorrow”. This is the mindset of a buyer who is looking anxiously for their next home after searching for months. They are tired of looking and do not want to settle on their dream home. They know when a house is priced right because they understand values by this point. They will purchase that house before anyone else because the thought of it being sold to someone else is devastating. There is almost always a pent up buying demand like this in any given month. One of the keys to getting a good deal on a house is being in the right place at the right time. You must also be ready to pull the trigger when you see it.
I have a client that I was showing houses to and his price point was tight. What he wants for the money rarely exists and if it pops up, will last a day on the market at most. Just last week, the house I know he would buy came on the market on a Thursday. By Saturday it was sold and they cancelled our Sunday showing. My client was out of town on Saturday and therefore missed that opportunity because he went skiing for weekend instead of going to see his next home. If you want to know how to get a good deal on a house, you must be ready to go and see something immediately. If not someone else is going to be steps ahead you.
So what do you do?
You should be watching for all newly listed properties like a hawk. If you do not find what you are looking for your first few times out, then your search can turn into a waiting game as long as you know what you want. You want to have the patience to wait for the right investment to pop up that matches what you are looking for. You can search Chicago Just Listed properties on this site under the “Buying?” tab.
Your agent should tell you if what you want for the money is doable. If it is, you want to watch for new listings that are well priced and go and see them the day they hit the market. Your agent should know a good value when it hits the market and will also be on the lookout for you. This is what real estate investors do so why wouldn’t you? This is key to knowing how to get a good deal on a house.
How To Get A Good Deal On A House Step 2-Catch A Property Right Before A Price Change.
Many sellers like to test the market when selling their house. This is because many sellers think their house is worth more than it really is. What sellers do not know is that “testing” the waters can hurt them. When a seller gains a lot of market time on their property, the price becomes more negotiable for 2 reasons.
- No buyer wants to buy the house that nobody else already bought. Buyers are more skeptical to the pricing of a house that has more than 30 days of market time. They wonder why nobody else has bought it if it was such a good deal. This thought gives buyers reasons to come further away from list price.
- A seller starts to become more open to negotiating as they sit on the market and become worrisome. A seller tends to be less negotiable as they first come on the market.
Let me tell you a true story of a friend of mine. Once upon a time…
This friend of mine is the world’s luckiest guy. Always has been, even in college. He was looking for a house to buy in the suburbs of Chicago. His price point was capped off at $750,000. However the house he wanted to buy was listed at $850,000. This house was on the market for over a year and the seller would not budge. The seller originally listed the house near $1,000,000 even though it was way overpriced. They wanted to “test” the waters. We were later told they turned down offers of $800,000, $850,000 and even higher than that.
Well…372 days of market time on the house and my friend decides to put an offer in low 700’s. The seller of course rejected it still believing that their house was worth more. The same seller ended up calling back and accepting a $750,000 offer weeks later because they finally had enough. Their stubbornness cost them a lot of money, but my friend bought a great house at a great price. He bought the house he wanted to and made a great investment. He just happened to catch the seller at the right time. The house would not have been on the market that long if it were priced correctly at the very beginning. The point of the story is that you never know what someone’s why is. Properties with a ton of market time can be due for a price reduction.
This is where some of the best deals are had.
How To Get A Good Deal On A House Step 3
You must have a good real estate agent. Not all agents are created equal and the experience level of a real estate agent makes all the difference in making sure you make a wise investment decision vs. a poor one. Let’s face it, real estate agents are a dime a dozen. Everyone knows a handful of real estate agents and most believe that all agents provide the the same level of service, but in fact that’s totally the opposite.
Think about it. Agents who have been in business longer than others are more than likely going to be better advisors for your upcoming investment. However, an agent’s experience level should be based on number of transactions completed vs. years in the business. There are many agents who have been in the business for 20+ years, but only do 5-8 transactions a year.
Let me tell you why you should hire a real estate agent today…
Agents should be experts in two things.
- They should be an expert in the local real estate marketplace. They should know their values inside and out be able to tell you if the house you are buying is a good investment. This is why you are working with them right?
- Agents are also experts in the home buying process. There’s a lot more to buying a house than just filling out some paperwork. Your agent is a facilitator and will walk you through a transaction from start to finish.
- They do not cost anything as the seller pays their commission 98% of the time.
The point here is that your agent should be no different than your financial advisor except for your real estate decisions. A good experienced agent does this day in and day out and can better advise you on any real estate investment. Would you buy a stock in a company you knew nothing about? Real estate agents look at values the same way. They know a good value when they see one. Good agents know how to get a good deal on a house.
How To Get A Good Deal On A House Conclusion
So if you want to know how to get a good deal on a house you should focus on the following three things.
- Hire a real estate investment advisor(shameless plug)
- Watch the “hot sheets” (newly listed properties)
- Watch for good properties with a lot of market time that may be priced above your budget (price more likely has a lot more negotiating room).
If you are looking to buy a new home and want an aggressive bulldog Realtor, then check me out. I promise you nothing but the best results or I’ll literally help you move. It’s only a conversation and you can see if I know what I’m talking about.
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Did you like this article? Want more proof I’m a complete expert and that you will have no regrets in just talking to me? Then check out some of my other articles I published. Every tip you want to know about buying or selling property is spelled out right below.