Shopping for a new home can be an emotional rollercoaster, and the process often takes several weeks or months. Once you discover that perfect home, it's normal to feel a mix of excitement and anxiety, which often leads buyers to act with a sense of urgency. However, before you have your agent draw up an offer, it's important to take some time to thoroughly evaluate the property and consider your terms.
Our real estate agents always encourage clients to take these steps before submitting an offer:
- Make a Pros and Cons List
Finding a home that checks every box is challenging, and first-time buyers usually need to make some concessions. However, you do want to make sure the home is a good fit before making an offer. Sit down and make a list of all the pros and cons of the home. Consider the asking price, location, age, size, yard, garage, and any other components that are important to you. A pros and cons list will force you to consider every element of the home and can help you determine how aggressive to be when making an offer.
- Have Your Agent Ask If There Are Other Offers
Listing agents aren't able to disclose the details of other offers, but simply knowing whether the property has received multiple offers is good info to have. If there are already multiple offers on the property, you'll want to work with your agent to come up with the most competitive offer you feel comfortable putting forward.
If there are no offers, you may want to start at or around the asking price. If more offers come in, agents usually will come back and ask for the "highest and best" at a later date, which will give you the chance to adjust your bid.
- Estimate Your Mortgage Payment
Before deciding what to offer, you'll want to make sure you're able to afford the down payment, mortgage payment, and closing costs. Your down payment will likely be somewhere between 3% and 20%, depending on what your lender pre-approved. Your mortgage payment is likely to fluctuate based on current interest rates, but you can use an online mortgage calculator for a close estimate. Your lender should also be able to provide you with a closing cost estimate based on the zip code and offer price. Bottom line -- you want to make sure you can afford what you're offering to pay.
- Evaluate The Market
The real estate market is constantly fluctuating these days due to the lingering effects of the pandemic as well as rising interest rates. As a result, it's important for buyers to keep their finger on the pulse of the market. Check out the asking prices on some other Holland homes for sale, and use those data points to inform your decision. Home prices generally appreciate over time, but as buyer demand wanes, prices could start to drop.
- Check The Home's History
The property's historical transactions could tell you a lot about the home. For example, if the current owners have only lived there for a short time, it could suggest a problem, and it's worth asking the listing agent for more information. Historical transactions can also tell you how much the current owners paid for the property and how the home has appreciated over time.
Submitting an offer on a home is exciting. But before you get carried away, make sure you do your homework. Contact us today for more home buying tips.