You've been pre-approved, you've researched your neighborhoods, you've determined your wants and needs and you have found the house you want to buy. So what happens next? It's time to talk with your Realtor to start the offer process. Make sure you have a buyer's agent representing you. It is not recommended to use the listing agent as they represent the seller and are looking out for the seller's best interests, not yours.
The first thing to do is have your real estate agent research the comparable sales from the past 3-6 months. Based on the recent sales in the area, your real estate agent will help you come up with a good starting offer. While researching the comps, your agent will let you know how many competing homes are for sale, how many homes have closed in the past 3-6 months, what is the absorption rate for the area, what is the average percentage of the list price sellers are getting for homes in the area and any other information pertaining to that particular property.
Other things to consider when putting in an offer:
- Find out why the owners are selling.
- How long has the property been for sale?
- Has there been a price reduction and when?
- How much did the seller pay for the property and how long ago?
- How much does the home owner owe on the home?
- What is the motivation for selling? - job transfer, downsizing, relocation etc.
- Are other parties interested in the property; is it getting a lot of showings?
- When does the seller want or need to close?
All of these questions will help you formulate a realistic starting offer. If you are asking the seller to pay for some or all of your closing costs make sure you factor that amount into your offer as this amount comes off of the seller's bottom line.
Decide how much earnest money you want to put down with your offer. Earnest money demonstrates to the seller your seriousness about buying a home. It needs to be substantial enough to show the seller good faith. This amount is usually around 1% of the purchase price. If the offer is negotiated successfully and you go under contract your earnest money will get deposited into the real estate company's escrow account and held in that account until closing. If your offer is rejected and you don't end up under contract, your earnest money check will be returned to you. If you successfully make it to closing your earnest money will be credited towards the purchase price of the home or towards your closing costs. There are also several contingencies that may be built into the contract to ensure you get your earnest money back in the event that the contingencies cannot be satisfied. Examples of these contingencies may be an acceptable home inspection, your ability to secure your financing and the appraised value must equal or exceed the sales price. If you back out of the deal for any reason not covered by a contingency you may forfeit the entire amount.
Now that you and your Realtor have done your research and come up with an offer price and terms you submit the offer and the negotiations begin!
Knoxville Home Buying Series:
How to Buy a Home in Knoxville TN- Step 1- Secure Your Financing
How to Buy a Home in Knoxville TN-Step 2- Determining the Best Knoxville Neighborhood For You
How To Buy a Home in Knoxville, TN - Step 3 - Determining Your Wants and Needs
If you are looking to buy a home in the Greater Knoxville TN area instantly search all homes for sale at www.MyKnoxvilleHomeSearch.com. If you are looking for a luxury home in Knoxville TN visit http://knoxvilleluxuryhomesellers.com.
Instantly search all properties for sale in the Knoxville TN and surrounding areas now!
www.MyKnoxvilleHomeSearch.com
Visit Christine McInerney and Jennifer Halinkowski with Keller Williams Realty on-line at:
www.HomesForSaleKnoxville.com and www.KnoxvilleReal-Estate.com
Office: (865) 694-5904
Christine (865) 237-5289 and Jennifer (865) 621-3658
Mail to: McIn-Kowski@HomesForSaleKnoxville.com
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Christine McInerney and Jennifer Halinkowski - Knoxville TN Real Estate - Keller Williams Realty Knoxville Copyright © 2009
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