Real Estate Expectations vs. Reality
Oh, to be a starry-eyed newcomer to the real estate game. Where you think you’ve found the perfect house, only to learn about some skeletons in its closet (sometimes literally). Where you put in an offer, convinced that this house is the one, only to have your offer rejected. Where you were sure your house would sell in two weeks and now you’re past the two-month mark.
No one likes going into a situation unprepared, so we’ve compiled some essential real estate tips for those times when expectations don’t line up with reality.
“Charming cabin in the woods” sounds great, until you show up to the property and it looks like the most recent “Saw” film was shot here.
Just like a salesperson, homeowners trying to sell will do what they can to amp up their property. Descriptions are made to captivate buyers so it’s up to the buyers to see through the charades. A few examples:
- “Quaint” — might be too small
- “Old Victorian home with lots of history” — might need lots of repairs, require more upkeep
- “Off the grid” or “secluded” — probably lacking access to anything from nearby restaurants and stores to decent internet service
- “Lots of potential” — it’s a fixer upper
- “Close to the action” — might be near a busy road, noisy
If you’ve ever eaten a microwave dinner, you know a thing or two about misleading photos. Photos won’t show the pet hair that’s embedded into the carpet or the leak in the ceiling that appears after a torrential thunderstorm.
While it’s true that staging photos are often trying to highlight the good and push the bad to the back of the closet, there are also times where you, the buyer, have to look with a critical eye. For example, photos of a private driveway in fall with the leaves changing are beautiful, but these photos don’t show the nightmare of plowing in winter.
Another thing to keep in mind: some photos are fake. Graphic design and digital renderings have become life-like. If you’re just going by photos alone you might find that the house you’re looking at doesn’t even exist yet.
It’s a huge jump to go from renting to being ready to buy. In that excitement, it’s easy to forget that buying a house isn’t like buying a car — the latter can happen in a matter of hours and the former can take months. The same is true with selling a house — it won’t happen as quickly as putting your bike up for sale on Craigslist.
In both instances, patience and strategy are key. First-time buyers might benefit from working with a real estate agent (sellers could too). Sellers need to have proper marketing and a good platform to list on. Buyers need to keep in mind that their offer might not get accepted, especially in a competitive market. Both parties need to recognize that real estate very rarely works on a perfect timeline.
FSBO sellers usually don’t realize the amount of deadlines and contract obligations they’ll need to deal with. You might think saving money from selling FSBO is worth it, but a lot of people don’t realize how involved the closing process is.
The same goes for buyers. The last thing you want is to show up to a closing without a lawyer or real estate agent present. Houses are massive investments and not having someone to walk you through the paperwork and process could hurt you in the end.
First-time buyers often have the expectation that the listing price is what they’re going to pay. There are a lot of unexpected closing fees that end up surprising buyers. Expect to pay anywhere between 2 and 5% of the listing price for closing — and plan on paying in full.
A “killer deal” house is often not what it seems. True, there are times when you can absolutely snag a deal, but it’s extremely rare to come across a low-priced home that needs no additional work.
Here are a few things to do before jumping on that killer deal:
- Walk through the house. Take pictures, ask questions, even bring a tennis ball to lay on the ground — if it consistently rolls in one direction, this could indicate an uneven foundation.
Some property investors are all about the deals and purchase things site-unseen. This is extremely risky for first-time buyers or for people wanting to live in the home they purchase right away.
- Get a home inspection. This is also something that property investors sometimes pass on but skipping an inspection is not a good real estate tip for beginners.
Additionally, make sure you include contingencies regarding this inspection in your offer.
- Do the math. Calculate all the estimated repair costs and weigh out if this house is still a “killer deal.”
If all this info has led to beads of sweat dripping down your face, don’t worry (and don’t feel bad). Real estate is a complex, highly nuanced industry and even the experts still have things to learn.
The way you can make this easier is by listing with an all-inclusive platform like RealtyHive. We have a network of agents from you to choose from (and with Cashifyd, you can even get cashback at closing) and countless properties available, all over the world. For sellers, our time-limited events and marketing tactics are designed to shorten your time on the market. Buy or list with RealtyHive today!