Any way you slice it, buying a home is a huge financial decision. Questions swirl around in your head like: Can I really afford this or how do I know it’s the best neighborhood for me? That’s why we have scoured the internet and talked to top industry professionals to provide you with a cheat sheet on what you need to ask when buying a home.
Here are the six questions that almost every real estate professional recommends you ask before buying a home:
#1: What have similar homes in the neighborhood sold for?
If you have a clear picture of the local housing market, then you can determine if the house you are looking at is a reasonable price. Realtors typically have access to all the comparable listing data for similar homes that are currently on the market or for those that recently sold. Armed with this information you might be able to make a lower offer or ask for concessions like having the seller to pay for some of the closing costs. The comparable listing data is also your best indicator of value because bank appraisers rely on the same information to determine the value of the home.
#2: Why is the owner selling?
Although the real estate agent is not required to give you this information, you may get lucky or catch some hints surrounding the circumstances of the sale. If you can sniff out that the owner is desperate to sell, then it can give you some more negotiating power. Some events that may indicate a rushed sale include relocation for work, loss of a job, death in the family, etc. It can also be critical to discover if the seller is trying to walk away from existing damage or required repairs – if this is the case, you may want to reconsider your options.
#3: What condition is the home in?
Getting information about the homes condition will give you an accurate picture of possible future repairs. It may not make or break the sale, but at least it will help you weigh the pros and cons of the home when compared to other possibilities.
Don’t forget about the roof – The roof is the most essential part of the home and repairs are costly. You want to know that the home you are potentially buying isn’t going to need an expensive roof replacement just a couple of years after moving in. A new roof has a life expectancy of between 15 and 50 years, depending on the materials. Not only is the condition of the roof important for you, but for your bank as well. If the roof has existing damage, the bank may require that it be repaired before they approve your loan.
#4: Is the home prone to natural disasters?
When making a long-term decision like buying a home think about the possibility of natural disasters in the area. The selling agent will know historical data to help you determine the likelihood of a disaster occurring in your area. It can also help you uncover the type of disaster to expect so you can prepare for the cost of additional insurance. Federally-designated, high risk flood zones for example, require flood insurance. On the other hand, if you are buying in an area like California, you won’t be able to predict earthquakes, but you can choose a home on a stable footing that can resist damage when the ground starts to shake.
#5: What is the neighborhood like?
Location, location, location! The area that the home is in will have a great deal of influence on the price of the home. What may look like a great deal on paper can often be a bad investment.
You can always renovate a home to give you all the features you want, but you can’t change the neighborhood. It is important to choose an area you are going to be happy with for a long time. Ask your realtor about the community; they should have all the information you need on amenities, crime, schools, and even traffic. Remember to steer clear of apartments, industrial areas, and commercial developments because they can lower the resale value of your home.
#6: What is the asking price?
This may seem obvious, but never forget to gather this data. After assessing the above information, you can determine if the asking price is fit for the home you are looking at. Consider working with a professional if you are uncertain on how to proceed.