Last week, I talked about knowing what you can afford before looking at properties. This week, we’re on to what happens when you’re ready to look at properties and even ready to make an offer.
When looking for that “perfect” home, what do buyers typically do? They look at several properties until they fall in love with one and then the “That’s it! I’ve got to have it!” mentality kicks in.
Well, buyers, here’s one of my biggest tips for you: Just chill out for a minute. Yes, go look at a bunch of places, and even, yes, “fall in love” with one. But then, take a moment to step back and evaluate the situation objectively.
A few years ago, buyers didn’t have the luxury to sit and meditate before making decisions. You either made an offer that day or lost the place… oh those frenzied days! Now, though, buyers have more time to hem and haw over things before making an offer or responding to a counter offer.
Here’s a checklist to help you “chill out” and think things over before making an offer or responding to a counter offer:
- Identify what’s important. Before looking at properties, write down on a piece of paper the your “evaluation criteria” and take it with you when you look at a property. Include in your criteria:
- How much you can afford.
- Things that you cannot do without (A/C, heating, 3 bedrooms, 1.5 bathrooms, pets allowed, assigned parking, etc.).
- Thing that you really, really want ( park nearby, association pool, within 20 minutes from work, washer/dryer hookups, easy guest parking, etc.) in order of importance.
- You be the judge. After each visit to a property, quickly jot down the pros and cons as though you’re a teacher grading the place (maybe even assign it an actual grade based on your evaluation criteria). This will help keep you in an objective mindset (no teacher’s pets!).
- Test the waters. Once you find a property that you “love”:
- Test the commute to/from work.
- View the property at the opposite time from when you first saw it (weekend vs. weekday and morning/midday vs. evening).
- Try to strike up a casual conversation with a neighbor walking his/her dog (there’s a lot of “underground” info you can learn from these casual encounters!).
- Give yourself at least 24 hours before making an offer. Do engaging activities completely unrelated to home buying (play at the beach, go to work, see a movie, go to a baseball game, etc.). Force your mind to think of something else.
- Do an objective evaluation. Pretend a close friend has asked you to analyze their situation and determine if buying this home is a good investment for them. Pull recent comps, other nearby properties for sale (available at the bottom of Redfin listings), community and school info (available on the left under “Community & Schools” on Redfin listings as well as greatschools.net), personal affordability info, estimation of needed repairs; how it rates compared to buyer preferences; and area hazards/dangers (crime, flood zone, earthquake faults, sandy soil, power plants, etc.).
- Continue to think objectively. You may be a superstar in thinking objectively up to making an offer. But, how many people go crazy during the offer/counter-offer process? Tons! After you make an offer, don’t get your heart set on the idea that everything’s falling into place. Again, take time to chill before responding to a counter offer. Don’t be talked into spending $30k more because you’re already envisioning a new life in the home.