Education and news for smart DIY landlords!
Buying a house isn’t like buying an iPhone at the iStore. Sure, you can ask questions about the specs. You’ll be given an honest to goodness description of what the phone can do and what you can expect in the long term. You can also modify it and take it anywhere you want to. When there’s a factory issue, it can be remedied by a simple warranty card. The phone’s price also drops when a new model comes out.
But buying a house is much more complicated than that. A house isn’t always newly constructed. Some home sellers will keep secrets about some interior problems. You can modify your home but you can’t take it with you when you’re moving out again. When there are damages that pre-existed in the house, the previous owner has no responsibility for it.
The housing market is also fluctuating constantly. One day your house could be worth more. The next it could be worth lesser. For you, the best thing to do is to ask the RIGHT questions. These questions will help you ensure that the house is worth your money.
There must be a reason why a seller is selling. It might be due to an urgency to move for job relocation. It can also be due to some life events. Either way, the reason for selling can determine your negotiating power. If they’re selling out of urgency, your negotiating powers are strong. But, if they’re not in a hurry, you have no leverage.
The longer the house stays listed for sale on the market, it becomes harder to sell. This is because early prospective buyers thought the starting price of the house was too high or there might be something wrong with the property. But for the late buyers who look into a home that’s gone stale on the market, this can be an opportunity to open negotiations.
The neighborhood is the #1 thing that you as a home buyer must consider. Nobody wants to live in violent, loud, and dirty surroundings. So make sure to check that with the home seller. Consider as well the convenience of travel to your job, the groceries, shopping areas, schools, and recreational facilities.
One home will differ in utility from another. For example, a house has a larger space than an apartment complex. More lighting will be used to light up the lawn, porch, and backyard. There is also more water consumption for the garden and lawn.
So, ask the home seller how much do they spend on monthly expenses. Most of them are comfortable sharing this information. And this will give you a good idea of whether the home can help you save more money in the long run compared to your previous living space.
Every parent wants what’s best for their children. If you have kids or are planning to raise a family, ask the home seller about their views on the local school district. Chances are if they’re also a parent, their children are also enrolled in the local public schools.
They’ll be a good source of information and will speak from experience. Ask about the pros and cons of every school in the area and see to it if they have any recommendations.
Asking the home seller how much it cost and when did they buy the house. Usually, they won’t discuss this with you. But, you can know how much they paid as it is a public record at the local deed office.
If you’ve found them to have priced the house significantly higher than how much they bought, you can open and have more room for negotiating.
These are the more expensive necessities of a home. You don’t want to freeze in winter or get cooked by the summer heat. You also might not want to put buckets all over the house every time it rains or end up stuck in the shower unrinsed because the water ran out.
Ask the home seller how old these important units are. Have there been issues? If ever so, were they repaired? This goes the same for any structural damage. If you want to pursue buying the house because you liked it, you can always negotiate for a cheap price.
What’s important here is that you know what’s in store for you and what you should work on.
Buying a home is the largest single investment you’ll ever make. To make it pay off, always take your time when searching for a house. When you’ve found one, ask questions until you have almost all the information about it. Then move to the final phase of negotiating to get the best price.
If you’re ready, make Landlord Prep your go-to resource for landlording education. Here, we offer a complete DIY landlording course to get you on the right track. Join our academy today. If you want, you can check out Flavia’s real estate investing webinar first!