Before making an offer on a house, there’s a lot to take into consideration as you prepare to make possibly the largest purchase in your lifetime. Finding the right home involves an incredible amount of research, so it’s vital that you ask the right questions in order to make a competitive offer on a home - one that you can afford and meets your long-term needs.
To narrow down your search to discover “The One”, here are 15 important questions to ask when buying a house:
1. Ask yourself – “What’s my total budget?”
It will be a waste of time to start seriously looking at houses without understanding how much house you can actually afford. There are additional costs to consider other than the sales price, such as property taxes, homeowners insurance, homeowners association dues, and ongoing home maintenance just to name of few. You must be certain that you are financially prepared to take on the costs of home ownership. That means contacting a lender and getting preapproved for a mortgage. A good lender will break down all of the costs so you will have a good picture of what you’re getting into. Also, showing the seller you have the financial means to buy their house is important if you want your offer to be accepted.
2. Is the home in a flood zone?
A property that’s in a flood zone may require additional insurance coverage which could be quite high. It’s not difficult to find out if your prospective property is located in a flood zone. As your Real Estate Agent, I can determine if the home you’re interested in buying is within a designated flood zone, which zone it is and what that designation means.
3. Why is the seller leaving?
It’s always good to get an understanding as to why the seller is moving — whether it’s due to downsizing, a job relocation or as a result of a major life event — this information could be helpful in figuring out how motivated they are when negotiating. A good buyer’s agent (ME, ME, ME, ME) will try to find out this information for you and gauge how flexible or inflexible the seller might be during negotiations. For example, a motivated seller who needs to move quickly or whose home has been on the market a while is more likely to work with you than someone who isn’t in a rush to move or who just put their home on the market.
4. What’s included in the sale?
Anything that’s considered a fixture is typically included when purchasing a house — think ceiling fans, light fixtures, and window blinds. However, there could be items that you think are included with the home but actually aren’t. This depends on your state’s laws but your Real Estate agent will review the fixtures section with you in the Offer to Purchase. I always say, “if you can flip the house upside down, whatever doesn’t fall to the bottom is a fixture!” The listing description in the MLS should spell out any exclusions that the seller is not including, but that’s not always the case so make sure your Agent asks. By the way, always ask for the refrigerator IN THE KITCHEN under the Personal Property section of the Offer to Purchase or you could be surprised to find an empty space where that nice refrigerator once was!
5. Were there any additions or major renovations?
Sometimes, property records and listing descriptions don’t always match up. A home might be advertised as having four bedrooms, but one of those rooms may actually just be an office or bonus room. Also, it’s good to find out what major repairs or renovations the seller has done since owning the home, and request the original manufacturer warranties on any appliances or systems if those have been replaced. Knowing a home’s improvement history can help you and your Real Estate agent better gauge its condition and understand the seller’s asking price.
6. How old is the roof?
This is MAJOR!!! Roofs are necessary and expensive and if a home’s roof is at the end of its lifespan and you wind up having to replace it shortly after move-in, you’ll be shelling out thousands of dollars. No fun at all!! If the roof has existing damage, your lender may require that it be repaired in order to approve your loan. Always find out the roof’s age to avoid a costly headache later.
7. How old are the major systems and appliances?
Understanding the anticipated lifespan of essential systems and appliances, such as the air conditioner, furnace, water heater, washer, dryer and stove, can help you anticipate major repair or replacement expenses. If these items are already at the end of their lifespan or near it, ask the seller to purchase a home warranty or consider purchasing one yourself, which can help cover the replacement costs in certain instances.
8. How long has the house been on the market?
In most cases, the longer a house has been on the market, the more motivated the seller will be to make a deal. This means you might find flexibility to negotiate the price, contingencies, terms and credits for replacing outdated carpet or other noticeable issues. However, in this current hot sellers’ market, I would seek the advice of a Real Estate Agent about this.
Many times, a home will languish on the market if it was priced too high at the onset, resulting in the need for multiple price repositioning. A listing that shows multiple price cuts and has been sitting on the market too long may give buyers the impression that something is wrong with it. And that gives you a golden opportunity to negotiate a deal.
9. How much have homes sold for in the neighborhood?
Understanding the current local market will help you determine if a seller’s asking price is on target — or way too high. I always pull the comparable listing data for similar homes that are currently on the market and have sold in the last six months or so as a basis for comparison. This is necessary in order to determine your offer price.
10. Are there any health or safety hazards?
Items like lead paint, radon, mold or other major hazards can be costly to address and put a hault on your loan approval. Ask the seller to provide documentation if there have been past issues and find out exactly what was done to resolve those problems. If a home inspector suggests additional testing, you might need to pay extra for those specialized services.
11. What’s the history of past insurance claims?
Get a copy of a Comprehensive Loss Underwriting Exchange, or C.L.U.E., report from the seller or in some case, the closing attorney will obtain this information on your behalf. This report will provide information on any homeowners insurance claims filed in the last seven years. This report can give you an insight into what, if any, damage the home has sustained from a weather event or vandalism that a home inspection doesn’t catch or a seller fails to disclose.
12. What are the neighbors like?
Getting the true feel of a neighborhood can be difficult until you’ve been there for awhile, but this aspect shouldn’t be overlooked. Try to find out from the seller what the neighbors are like. I always encourage my buyers to drive through the neighborhood at different times of the day and week, if possible. What’s going on Friday night around 9 pm? Noisy or quiet? Also, is it a pet-friendly place or are there few pets around? Are the existing neighbors friendly or more likely to keep to themselves? Don’t rely solely on the seller to reveal these details because you might not get the full story. Neighbors are an excellent way to get information about the community that a seller might not want to share.
13. How is the neighborhood?
Location, location, location! Always take the neighborhood into consideration. It’s important that you like the area you’ll be living in for the next decade or beyond. As your Realtor, I can help you find out key information, such as community amenities, crime statistics, school ratings and how busy traffic is where you’ll be living. And don’t forget to time your commute to work — which might be a deal breaker.
14. Are there any problems with the house?
Sellers are required to provide a disclosure form listing any known defects, but what they don’t disclose and you don’t know can lead to major issues later and possibly end the deal. That’s why it’s critical to get a home inspection done by a professional, licensed home inspector as soon as you go under contract. The inspection report outlines the home’s overall condition and can help you negotiate future concessions, such as repairs or seller-paid credits, before closing.
15. How much will I pay in closing costs?
The down payment isn’t the only cash you’ll be forking over on closing day. You’ll also be responsible for closing costs, which are separate from the down payment and typically include loan origination fees and third-party fees for title research, processing of paperwork, an appraisal and other administrative tasks. Expect to pay around 2 percent to 5 percent of the home’s purchase price in closing costs, but that can vary depending on your area.
The closing disclosure, which a lender is required to provide you before closing, will spell out all of your loan fees and how much cash you’ll need to close. Once the closing documents are signed by both parties, the closing attorney sends it to the lender, and the lender funds the loan – guess what? You’re a homeowner!