SELECTING HOUSES TO SEE IN PERSON
Now that you are pre-approved and have chosen a real estate agent it’s time to see some houses. Selecting houses to see in person can originate from you or from your agent.
My personal favorite move is setting up an automated filter for my clients. I populate the filter criteria with information such as the buyer’s desired square footage, bedrooms, bathrooms, etc., so that when a home that meets the criteria is listed, an email is sent directly to you (the buyer) and me (the agent). This enables us to immediately see that the house is listed and schedule a showing, if interested, rather than actively searching real estate websites constantly. It’s a game changer in a fast-paced market.
The other, more obvious, way to select houses to see in person is to search real estate sites. I recommend Mibor. This is the real estate site that agents in Indiana use to list homes, so the information is more likely to be accurate.
Technically, you can see any house… but is it really worth your time to see all houses? I recommend making a list, or having your agent make a list of your must-haves. When a house is listed and you want to see it, ask yourself: does it check off most or all of your must-haves? If not, then it may not be worth seeing.
I don’t recommend seeing homes listed higher than what you’re pre-approved for. The biggest reason is there’s a chance that you’ll like it; and do you really want to see something you can’t buy? It can have the effect of making every other home you’ve looked at in your price range feel inferior. Plus, I don’t love the feeling of showing someone a home they can’t have. It feels cruel.
Some sellers will request to see your pre-approval letter prior to a showing. This is not common, but I have had it happen at higher price points. It prevents the seller from spending time preparing the home to show, when the buyer has no intention of purchasing.
SHOWINGS
Showings are usually scheduled for 30mins – 1hrs, but you can request longer showings for unique or large properties. Let your agent know if you want to walk the 20 acres behind the home, or if you want to see the home during a certain time of day. This allows your agent to plan accordingly.
I’m also not against the buyer discussing unique property traits with the seller. I primarily work in rural areas, so the house may have geothermal, wood boilers, acreage with specific traits, and so on. I find it helpful if the seller can be present during a second showing to explain these features. And yes, I did say second showing. If the market is slow enough and the buyer needs an additional look at the house before deciding, you can request a second showing. This is also helpful if you're circling back to house you haven’t seen in a minute.
What to look for during showings:
Possible damage or unknown/undisclosed details
Amateur handy work
Imperfections that did not convey in the photos
Structural, electrical, and plumbing condition
Age of appliances, furnace, water heater, etc.
Roof and window condition and age
Evidence of termites or other insects/animals
Review the seller’s disclosure
Confirm with your agent, what is include and excluded in the sale
Keep in mind: your agent is not an inspector. They may be able to point out items to look for, but they will not be able to provide insight or guidance if something seen during a showing is an issue, unless they have additional specialties.
SUBMITTING AN OFFER
This is the exciting but nail-biting portion of the process. You’ve found a home that you love! You can picture yourself there and you’re so close to making it yours. Once you submit that offer, it is in the seller’s hands to accept, reject, or counter it. Let’s talk about crafting your offer. Your agent will walk you through and populate the purchase agreement, but there are many details you can add, remove, and/or change:
1. Understand what you can offer.
Are you able to offer additional money, time, or remove contingencies? Additional money can be offering above list price, offering to pay above the appraisal price, or to pay some seller closing costs. We’ll get more into appraisals in a future post in the buyer’s series. But essentially, you can offer to pay more money for the home.
Other non-monetary ways to craft an enticing offer is to offer the seller additional time after closing for them to occupy the house, expedited timelines for inspections and closing, or removal of contingencies, such as inspections. If you (the buyer) are not in a hurry to move in, then you may be able to offer the seller occupancy time after closing.
You may be able to expedite the inspection and closing process if your purchase is not contingent upon any other factors. Another big one is submitting an offer that is contingent upon your current house selling. If you have to use the proceeds from your current home toward the next home, you will likely not want to remove this contingency. I would not recommend waiving inspections, but it is an option.
2. Understand what is important to the seller.
This is important because you, as the buyer, don’t want to waive all contingencies, offer more money, and give additional time if that is not necessarily what it takes to get the offer accepted. Work through your agent to understand what the seller may value most and focus on negotiating that aspect of your offer.
The seller may be already moved out and want to sell fast. This would be a situation where expedited inspections and closing could work in your favor. If the house is likely to get many offers, additional money over list price or appraisal may stand out. If the seller hasn’t found other living arrangements, giving them time for occupancy after closing may be best for them. Like I said, work with your agent. They should be able to talk to the listing agent or they may have more information in the agent-to-agent remarks within the listing website.
Your offer will have an expiration specified. Usually within 24-48 hours. After this date and time, the offer is not active. I’ve had listing agents deliver counter offers with an extension to the purchase agreement expiration, and I’m not a fan of this approach.
Get your pre-approval letter updated prior to submitting an offer. You want your pre-approved value to match your offer price. If the seller sees that you are approved for a higher value, that may pursude them to counter higher.
At this point, you’ve seen the houses, submitted an offer, and now you wait for the seller’s response.
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