Buying a home is undoubtedly the biggest investment you will ever make, and it natural to be intimidated by the number of zeros at the end of your offer and your mortgage.  However if you are using a Real Estate agent and not paying attention to the wealth information and assistance they provide, based on their knowledge and experience, you will never buy a home.


Reason # 1-Unrealistic expectations of what you get for a certain price point.


A majority of homebuyers use the internet as their first source of information on the housing market. The internet is a terrific source of information to get a fairly good idea of what a house sells for in a specific location, and more importantly, what you get for the price. I have had buyers contact me to inquire about a specific home in a specific area, tell me they have been searching on the internet for weeks/months, then go on to say, “but I want more bedrooms, another garage, a finished basement, upgraded baths, upgraded kitchens, etc.,  for the same price”.

When I politely tell them that it’s going to be tough to find all that without paying more for those amenities, they either get angry, or are sincerely baffled that this may be the case.

If your belief is that Realtors can work miracles and find a home for $300,000 similar to one that would typically sell for $400,000… you will never buy a house.


Reason #2- Unrealistic offers/lowball offers


Buyers and sellers all want something in a real estate transaction.  Sellers want the highest possible price and buyers want the lowest possible price. If your agent does a market analysis of homes similar to one you are interested in (let’s say it’s listed at $350,000) and provides information that others similar homes recently closed between $330,000 and $340,000, offering $300,000 (“because “it’s a buyers market”, or “the housing market is so bad right now” or for “more room to negotiate”) may not be the best approach. Lowball offers often insult the seller and/or make them assume you are not serious. (I call these offers fishing expeditions…let’s cast out a number and see if the sellers bite).

As a buyer you have to remember that the same comparatives your agent provided to you to establish a fair offer price are the SAME comparatives the sellers agent presented to them to establish the list price !!  Sellers are keenly aware of what their house is worth (most of the time).  I have seen time and time again, buyers insist on a making a low offer, despite my counseling that the house will probably close for “X” based on the comparatives, and lose the house, or houses, with lowball offer after lowball offer. Follow up of the sales usually indicates that I was (fairly) correct as to sale price.

There is a time and place for making an offer on a home that is significantly lower than the list price.  Overpriced listings (also based on comparative sales), some fixer-uppers, short sales etc, often have a better outcome with a low offer.

 If you aren’t willing to listen to your agents’ advice, and don’t believe the numbers and statistics placed in front of you…you will never buy a house.


Reason # 3- Thinking something better will come along


Over the years I have had buyers come and then go because they just couldn’t commit to buying a home no matter what they said out loud.  Time and time again I have showed 10 to 20 homes to a buyer, and by that time they (should have) have gotten a clear indication of what you get for a certain price point, area, amenities etc.  They finally find one they love and can see themselves living in, but want to wait to make an offer because “something better may come on the market”.  Invariably, nothing “better” comes along and when they decide to make an offer on the home they loved, it’s already been sold. 

If you have a good realtor who is showing you homes that meet most, if not all, of your needs and criteria, and hesitate to make an offer….you will never buy a home.


Reason # 4- Listening to family, friends and co-workers to get real estate advise


I was told by one of my buyers after a home inspection, where the furnace and water heater were functional but older, “I want the seller to install a new furnace and water heater. I am entitled to a new furnace and hot water heater”. When I asked where he got that idea, he said “my friend told me the seller must give me a new one”. I reminded him that his home inspector mentioned in the report and recommended budgeting for a new one in the future, not replacement. I asked if his friend was a Real Estate agent, attorney, licensed inspector, plumber, HVAC expert etc.  When my buyer answered no, I questioned how he can give advise on the subject, my buyer said “he knows all about this, he just bought a house too”. The seller refused to replace items that were in working order, and the transaction fell apart.


Another buyer looked at a truly move in condition, fully (and high end) updated home, listed at $460,000, which met all his requirements, and was in an area he loved.. He wanted to make an offer on the house.  So I ran the comparatives, and went over the numbers with him, telling him the house would probably sell for $435-$445K. His offer was $415,000 and he would not come up a cent.  When asked why, he said, compared to the other similar homes we saw , this one doesn’t have a basement, so I have to take off $30,000 from the asking price. I referred him back to MY analysis, which had already adjusted for the lack of basement. His reply was “my friend is a builder and said it costs $30,000 to build a basement in a new construction home”.  When I reminded him that the adjustments for existing conditions are not the same as building costs, he decided not to make the offer at all. The house eventually sold for $437,500.

If you don’t trust your Realtor knows how to give you the best comparative market analysis, how to prepare and interpret  them, and how to advise you on offer/sales price based on their knowledge of the area sales…you will never buy a house.

Our job as Realtors is to bring together a buyer to buy a home and a seller to sell their home.  The best negotiated price is a fair one based on current market comparable sales, and usually one where both the buyer and sellers aren’t 100% satisfied.  There will be compromises along the way on both sides, and getting an offer accepted is only the first of many. Remembering you hired a professional agent to help you find a home is akin to hiring a professional attorney, plumber or electrician.  If you don’t trust their advise based on their knowledge and experience, it never works out for anyone.


Reason # 5- Listening to the hype in the media


The media is rife with information about how bad the current housing market is, and has the statistics to prove it…or do they?

Sure the market is not the best right now, and worse in some places then others, but that’s on national standards and averages. Real estate is SO very local those national averages just don’t apply across the board.


According to the US Census Bureau, the average national sales price in 2011 was $242,300 and the median (the middle where 50% were higher and 50% were lower) was $212,300


In my town, there are 3 zip codes, and each one has it’s own micro-statistics. In my entire town, the median sales price of a home was $303,500 based on home sales from Jan 12 thru March 12, 2012. Compared to the same period one year ago, the median home sales price increased 5.6%, or $16,000. 


However in one of the ZIP codes, from Jan 12 thru Mar 12, 2012the median sales price was $410,000. Compared to the same period one year ago, the median sales price increased 23.5%, or $78,000.


Hmmm, not the same news as what we see on TV or read in the papers.


This actually ties into reason # 2, making low ball offers because the market is “so bad” right now.


If you are not willing to listen to your agent and believe the statistical numbers obtained from the local MLS sales records, and don’t believe the old adage about “location, location, location”, ….you will never buy a home.