Real estate purchasing or selling is likely one of the most misunderstood facets of the housing industry.
Little is understood regarding the range of issues that may be involved during and after a transaction.
All most people see is that a “For Sale” sign may translate into a large commission for the Realtor without fully understanding the range of services and protection provided and the potential risk involved.
Jack Waller, a founding principal of the Michigan Based real estate school NCI Associates in Metro Detroit, reminds us of the three pillars of service that a Realtor provides: advice, advocacy and negotiating.
A real estate professional, like a great builder, will bring a trusted team of related businesses to the transaction, from finance to home inspection.
Some additional reminders of common mistakes homebuyers often make follow.
As soon as we fall in love with the design, location or certain amenities the property has, we lose our objectivity in the negotiation and may be blinded to other, more serious, issues. A Realtor can help us to see the bigger picture when emotion has clouded our vision.
Not examining insurance issues is another of those. Most policy owners do not really know what they are paying for until they are in a claim situation, when it may be too late. You should work with a local flesh-and-blood agency that takes the time to fully understand your objectives and your risk and knows how to shield you from fiscal disaster in a crisis.
Mark Kramer, from Kearns Brothers Roofing in Livonia, gives us a classic example of how important this can be in light of owners affected by recent high winds. He relates several conversations with building owners who believed their policies would make them whole with repairs or replacement on the roof, only to find the policies had exclusions written into them for wind damage.
Realtors will also advocate for a professional home inspection to discover the true condition of the property. They remind us that inspectors are not regulated in many states, so simply hiring a local builder or tradesperson to walk through the home can set the stage for missed problems or potential concerns with the property.
A local and professional Realtor will advise owners to exercise due diligence in discovering the nature of the property and its surrounding amenities. What do you know about local crime statistics, proximity of schools, places of worship, health care, or other vital locations? Are the power lines and other utilities known to be dependable? Are there any environmental concerns that you should be aware of?
A trusted Realtor is passionate about the industry and is more likely to be aware of long-term issues that may affect value or quiet enjoyment.
Another item to explore with your advocate is how the property may suit your needs over time. Do you foresee a potential desire to expand the building footprint, perhaps due to familial additions? Is there a history that can be explored regarding the attitude of the local jurisdiction regarding this?
Hidden and unexpected costs can also sully a deal very quickly. Your Realtor will advise you to obtain a letter from a well-known and trusted lender indicating what you qualify for in terms of down payment and monthly expenses. Though the anticipated house payment is a part of this, what about the impact of the adjusted tax basis computed after you have closed the transaction?
Various closing costs can be anticipated by using experts who routinely deal with these issues. There are stories told of buyers who had to back out of deals after realizing the ancillary costs priced them out of the purchase.
Limiting your home search only to what you see on websites or open houses can preclude you from finding what you really want. Professional agents subscribe to services that make them aware of many more available properties to give you a broader range of choice in what you consider.
Unless you are constructing a new building, consider that new properties are placed on the market every day. Buying a home is a process of elimination as you move through the available inventory. A Realtor who understands your objectives can be of immense help in this winnowing process.
Let the Guys help you to engage a professional that can become your advocate, your personal concierge to the next real estate purchase.
You can find professionals like these every day at insideoutsideguys.com.
Listen to the Inside Outside Guys every Saturday and Sunday on AM 760-WJR from 10 a.m.-noon or contact us at insideoutsideguys.com.
This article originally appeared on The Detroit News: The Inside Outside Guys: Avoid mistakes with a trusted Realtor
Reporting by Ken Calverley and Chuck Breidenstein, Special to The Detroit News / The Detroit News
USA TODAY Network via Reuters Connect
