The Internet has changed how buyers find homes. Not too many years ago, the only way to even know all of the homes that were for sale was through a real estate agent.
Nowadays, almost every single home on the market can be found on the Internet. (In fact, it’s almost impossible to miss a home that’s on the market.) It’s become easier to “find” the home of your dreams. And the chances are, you’re going to be addicted to looking for homes online at all hours...even at work. (Just make sure to minimize your screen when the boss walks by! LOL) Now, this is some deep stuff most agents don’t even realize or think to address with their clients…
See, back in the day, agents had to “find” the perfect home for their client...and that expectation kind of still exists. Yet, buyers often “find” the home they want before their agent specifically brings it up to them.
So, some buyers get aggravated that their agent “must not be doing a good job” if they aren’t sending the client the listing before they find it themselves.
This may be true with some agents, but mostly it’s a matter of agents just being busy, out on the road, in a meeting, or whatever. The client just happens to be looking constantly for their own home while an agent has many other people and homes to deal with on any given day.
Regardless, “finding” the home is not a single moment. It’s a process. It’s about seeing many homes (online and in person) and gradually understanding the market so you make the best decision.
And beyond that, “finding” the home isn’t even the most important part of the agent’s job. The real skills come in once you’ve found a home, make an offer, and start going through the process to close on it.
We always bring this up because it’s a silly perception that we’ve seen cause issues between agents and their buyers, and it can cause friction that gets in the way of the agents doing the more important things as well as they could moving forward.
While you are looking online we want you to be aware of a couple of things you may run accross:
Finding a "FSBO"
OK, not every home is “on the market”. Some are what we call “FSBOs”. (Pronounced “fizzbo”.)
These are homes that are For Sale By Owner.
And lots of buyers think that these are going to be the steal of a century, since they aren’t on the open market. (Although nowadays, many are on the MLS as well, by hiring limited service agents to input it, but the owners represent themselves.)
Anyhow, these are rarely a deal. The owners may very well be trying to “cut out the middleman”, but they’re rarely willing to pass those savings along to the buyer. (In fact, most FSBOs are way overpriced, even above what they should be on the open market.)
Does that mean we should not look at FSBOs? Not at all. We can certainly look at FSBOs.
So, if you or we come across one that meets your wants, needs, and budget, we’ll certainly approach the owner.
Here’s the thing…
Let us call them first. We’ve been trained on how to deal with them. We know what to say and what not to say. And how to say it. This will increase our chances of actually getting a deal on a FSBO.
So, if you see a FSBO sign, just take down the contact info and address, and let us do the rest.
One Thing You Shouldn’t Do.
Just like with FSBOs, you also shouldn’t call listing agents directly.
Buyers often feel like there’s no harm in just giving the listing agent a quick call to ask a few questions. Or, they see a homeowner standing outside and strike up a conversation.
This probably sounds harmless enough. However, we’ve seen too many buyers say too much—or say the wrong thing—and it ended up costing them a home or led to them paying more than they might have otherwise.
Everything you say, and everything a listing agent or seller knows about you, can come back to haunt you.
Look at it like this…
If you were about to go to court, would you think it makes sense to have a casual chat with the other side? Probably not.
Same thing applies here.
Let us do the talking with the other side. Not just once we’re in a deal, but also until we find a home and are under contract. We know what to say, and what not to say, to make sure we protect your best interests.
Foreclosure and Short Sales
Speaking of getting a deal…
Lots of people think that going after foreclosures is a good way of getting a good deal. It can be. But it can also be a risky purchase and tough to even buy one.
Going after a foreclosure before it hits the open market (at an auction or sheriff sale) requires that you take on all risk. Oftentimes you can’t even see inside the home before you make an offer. Plus, you have a very short period of time to come up with proceeds if you successfully win the bid.
The better way to go after foreclosures is to focus on those that the bank (or other lender) bought back and put on the open market. We can certainly consider those. At least we’ll be able to get inside and see the home. However, they will likely not do any repairs or credits for anything wrong with the home. And, if you want to do inspections, you will likely be responsible for turning any utilities on and on for inspection since most utilities have been turned off and the homes winterized on these types of foreclosures.
This applies to “short sales” as well. These can also be a way of getting a good deal, but you will likely have to accept the property as-is. However, an offer on a short sale can also take quite some time to be approved, if at all. So you need to be patient if you decide to go after one.
With all of that said, just because something is a foreclosure or a short sale doesn’t mean it’s necessarily a “good deal”. It depends on how much you can get it for and how much work and risk you have to take on.
So if you’re interested in a “distressed” property (the industry term for foreclosures and short sales), we can certainly throw them into the mix. Just make sure you approach it with eyes wide open and know what you’re getting into...and only as long as the deal is good enough to make it worth your time, effort, and financial risk.
Don’t Trust Everything you See Online.
Piggybacking off of the last section…
One of the things we often hear from buyers is that they came across a great deal on Zillow, Realtor, or some other online site.
They see a home that looks like it’s for sale and at a ridiculous price. It usually turns out that it is a “pre-foreclosure”, and the site is indicating how much is owed.
More often than not, these homes are a long way from actually being foreclosed. Many never will be foreclosed. And even if they are foreclosed, the bank will not likely let someone else scoop it up for such a sweetheart deal. Instead, they’ll buy it back and then put it on the market for a higher price.
So don’t get too excited when you see that sort of thing online.
In fact, don’t be surprised if you find many homes on these sites that aren’t actually for sale at all. Many times they show homes that were sold and closed some time ago.
On another level, also don’t put too much stock in any website’s online estimate of value. Do not base your perception of market values on any of these. They are typically highly inaccurate.
So, when it comes time to decide on how much to offer for a home you like, don’t rely on any online estimate of value.