Don't fall for real-estate myths in this market
You're not going to get 50% off the asking price on a home, and the good houses in the good neighborhoods go fast.
It’s easy to think that because we're in a buyers market, buyers can call all the shots: Wait weeks before deciding whether to make an offer on a particular house, find grateful acceptance of lowball offers or scoop up homes for 50% of the asking price.
Good luck with that. Clinging to those and other popular myths may keep you from getting the house you want.
I'm always amused to see how unrealistic some of the would-be buyers are on the TV house-hunting shows. But when I was 25, I knew everything, too — even if I didn't realize my life would never be complete without granite countertops and stainless-steel appliances.
Syndicated columnist Lew Sichelman had a column in last weekend's Los Angeles Times about some of the real-estate myths that can keep buyers from getting the homes they want.
"… many people believe they can make any bid they want, no matter how ridiculous, because it's a buyers market. False," he wrote. "Even foreclosures and short sales are never priced at half their value 'or anything even close to that type of fire-sale discount,' says Christina Rordam of Exit Real Estate Results in Longwood, Fla."
No one can predict how a particular seller will respond to an offer, whether the seller is an individual or a bank. If the seller doesn't like you, you run the risk that he will refuse to deal with you.
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Here are some other myths that could doom your purchase:
- If the house has been on the market a long time, the seller will take a low offer. Wrong. The house could be on the market a long time because the seller not only won't take a low offer but also won't take a reasonable offer.
- A distressed property is always cheaper. Maybe it is and maybe it isn't. Lenders aren't always logical in their negotiations, so you may get as good a deal or better from a realistic homeowner.
- If you look long enough, you'll find your perfect house. Afraid not. The perfect house doesn't exist, at least not in your price range. And that's true no matter what your price range.
- Your family and friends will give you good advice about real estate. They'll give you advice, all right. But it is unlikely to be as good as the advice you'll get from a professional.
We'll offer one more piece of advice: All real estate is local. Very local.
That means that while it may be a buyers market nationwide, or even in your city, it could easily be a sellers market in your first-choice neighborhood. Do your homework.
If you're thinking of buying a home, we suggest you dig into the articles in in the homebuyer's section of MSN Real Estate. That should save you from a few misconceptions and a lot of wasted time.
If people would list their homes for what they are worth and stick to that price it would help bring the values up, stop dropping the asking amount every month it would be better for the community as a whole. Let the forcloser's wash through the market, you are not going to change someone's mind or pre-approval.
We the people that make out payments and take care of our homes and property are being penalized by the losers that over financed, over bought, never thought ahead or had a plan to keep the home they bought.
About Teresa Mears
Teresa Mears is a veteran journalist who has been interested in houses since her father took her to tax auctions to carry the cash at age 10. A former editor of The Miami Herald's Home & Design section, she lives in South Florida where, in addition to writing about real estate, she publishes Miami on the Cheap to help her neighbors adjust to the loss of 60% of their property value.