Overpaying for a house is every buyer’s worst nightmare. Knowing what a property is worth is crucial – so do your homework, know what you want, understand the market and make sensible offers
Before being swept up in the property market, consider the following things.
Set a benchmark
Compare nearby properties – real estate comps are comparable properties in a specific area that you’re looking to buy or sell in. Comps are used to determine the value of a home by comparing it to similar properties sold in the same neighborhood or in an area as close as possible to the house being valued. This provides a valuable bargaining tool when you are negotiating with a seller or agent. Make sure the properties are comparable, with a similar land size and number of bedrooms.
Keep in mind current market conditions
Market conditions are the factors that influence the housing market in a particular area, such as cost of living, demographics, supply and demand, mortgage rates and more. The property market is always changing, so doing this research once and sitting on it for a few months will offer little help. Going to open homes and auctions regularly will give you insight into the current state of the market and how much certain properties are going for.
Expand your search
You may have your eyes set on one particular suburb, but don’t limit yourself to that area – especially when starting your search. Explore other suburbs and see what’s available in areas that still tick all your boxes. Being able to see what else is out there will allow you to be sure in your decision and be more aware of what you can get for your budget.
Don’t exceed your financial capacity
Before you start your search make sure you set a budget. Sticking with this will stop you from getting into financial troubles further down the track. If you are thinking of taking out a loan, make sure you get pre-approval before making any offers on a property to eliminate the risk of the loan falling through. Remember, only ever commit to a loan that you can afford alongside your current income and expenditure. Lastly, when calculating figures for the price of a home, ensure you budget for maintenance and repair costs, as well as any other expertise you may require in the purchasing process.
Bring in the extra support
Buyer’s agents have insider knowledge and expert negotiation skills that can prove very useful. Buyers agents have the opportunity to find the best properties that fit your search criteria, whilst being able to eliminate properties that far exceed your budget. This is a practical option for individuals who are less experienced in the property market or who aren’t comfortable with negotiations and bidding at auction. Buyers’ agents also have the capacity to fast track your property search, which is especially helpful to those who are tight on time.
Are you starting your property search? Get in touch with us today to discuss your next moves.