UP [Buyer's Agent] [How To Buy] [What Is Involved] [House vs Condo]

HOW MUCH SHOULD YOU PAY FOR A HOME?

Buyers are always concerned about overpaying for a home, but it is not always clear how much a home is really worth.   If you buy in a newer tract development, prices will be fairly consistent.  In an older, established neighborhood prices are less uniform. 

Before you make an offer to purchase a home, ask your real estate agent to prepare a COMPARATIVE MARKET ANALYSIS of the property.  The report should include information on current listings, sales pending, and closed sales in the last six months, and the properties should be similar in size, condition, and location to the one you are considering buying.  Then compare amenities, condition, and the asking prices with the home of your choice.  But, keep in mind that selling prices, not listing prices, are the true indicators of the fair market value.

A sale pending is where a buyer and seller have agreed on the terms of sale but the transaction has not yet closed.   You usually can't find out the selling price of a pending sale until the transaction closes because this information is kept confidential.  But it is safe to assume that if a property sold quickly, it probably sold close to the list price.  If you have any doubt about the value of the property, include a provision in the purchase agreement, that the house will have to appraise for the purchase price.  If the appraisal comes in low, you have a legitimate way out of the contract, or you may be able to renegotiate the sales price with the seller.

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