You try on clothes, you test drive cars – you even sample food before you buy the bulk package from the warehouse store. So why wouldn’t you test drive a home before you buy? A home is one of the single, largest purchases you will make in your lifetime.
Particularly if the budget is tight, consider taking a test whirl in a comparable home to what you’re angling to buy before making the actual purchase. By spending 6 months to a year living in the neighborhood and tracking actual housing expenses, you can gain a better understanding of the nature and scope of your purchase before you sign on that dotted line.
Among those little details that you will discover:
- A more accurate estimate of homeowner expenses. In addition to mortgage payments, keep an expense diary and track all costs that you would have had to pay, had you owned the home. This includes your utilities, property taxes, insurance, and repair or upgrade expenses that you would have incurred during your time, if you owned the home. For example, if the water heater goes out, log the cost. If the heater is serviced, log the cost.
- The maintenance and responsibility required in having the home. Yards are beautiful to look at and many homeowner’s dream. But in addition to the expense of watering and care, are you willing to take on the yard work? Living in a home and getting an up close look of what type of yard maintenance is needed during the year can be an eye-opening experience.
- The commute to here, there and everywhere. Regardless of whether you drive to work on your own or use public transportation, you’ll learn what the actual commute would be like–day in, day out and in different weather conditions. In addition, you’ll gain firsthand experience as to proximity of shopping, doctors and the other amenities are in relation to your home.
- The neighborhood setting. By living in the area, you’ll notice the traffic and the people patterns, and you’ll learn more about particular lots and locations than any realtor could ever tell you, and perhaps you can avoid buying the lot where parents, children and dogs congregate every morning for the 7:30 am bus stop!
It wasn’t that long ago that the term “lowball” was so offensive that it made people cringe upon its utterance. Boy, have things changed. Though people still don’t like this word, I believe that people are becoming more acclimated to the notion of a low offer. Whether they are ultimately accepted or not, I argue that the concept is no longer as repugnant as the word itself.
In reality, a low offer can still offend a good number of sellers — especially those who insist on bringing their homes on at 2007 prices. However, for veteran sellers (and by that I don’t mean people who have sold many homes, but rather those who are still trying to sell the same home), a lowball might even be a sign of encouragement – or at least hard evidence that buyers do exist, or for that matter, that even lookers do exist.
Furthermore, as the economy sinks further, deep price cuts are felt all over. It’s unfortunate, but more people accept lowballs in other aspects of life as well. Massive layoffs are forcing specially trained and highly skilled workers to pursue other career paths that include significantly less pay. Lowball. Families now accept the dual careers as a requirement rather than an option to raise a family. Lowball. It only makes sense that in real estate sellers must now look upon a “lowball” offer as an invitation to deal rather than as injury and insult.
When all is said and done, with the continued uncertainty of the housing market and economy in general, I, for one, have lost sight of what a lowball offer is anymore. If a house sits on the market for months without activity and a less-than-ideal offer comes along, is that a lowball or simply a more realistic estimate of fair market value than the original listing price was? I guess this is where certain conditions can transform a lowball into a simple offer:
- A listing price out of line with comparable sales and/or listings.
- A vacant home.
- A long listing time. (Again, not sure what “long” is here, but it’s likely longer than three months, and the longer out you go, the less likely the seller will consider your offer offensive.)
- If the subject property is one of the last available in a new development that a builder is trying to close.
- Divorce or estate sales.
I can’t speak for all of you, but from where I sit today, a lowball is definitely better than a no-ball.
You try on clothes, you test drive cars – you even sample food before you buy the bulk package from the warehouse store. So why wouldn’t you test drive a home before you buy? A home is one of the single, largest purchases you will make in your lifetime.
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