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The Perfect Real Estate Deal

Real Estate deal broken into understandable segments

Real Estate deal broken into understandable segments

 

THE ANATOMY OF A PERFECT REAL ESTATE

Text version

TRANSACTION

Last year, 5.9 million homes sold
in the U.S. That’s one every 7 sec.
The median home price was 198K.

CONTRACTS

“Contracts are the foundation to any real estate deal.” – Jason Moss
Most deals fall apart because one of these goes wrong:
1. Make sure there is a meeting of the minds.
2. Everything important to you must be in writing.
3. Mind your deadlines.
4. Once agreed, follow through with diligence.

Fun Fact: The #1 most difficult task for “FSBO’s” is navigating the contracts.

NEGOTIATIONS

3 most important things to remember:
1. Be informed–having backup data will increase success.
2. Try to remove emotion from the situation.
3. Get the numbers right–not too high, not too low, just right.

5 Factors For Success:
Poker face- Having options-Timing- Pshycology-Big picture
Fun Fact: On average, sellers accept 98% of their asking price.

65% of the avg
American family’s
net worth is in
home equity

DISCLOSURES

5 important disclosure tips:
1. The days of buyer beware are over.
2. Disclose. Disclose. Disclose.
3. Make sure to review the disclosures carefully and understand them.
4. When in doubt, disclose it.
5. If there is a law suit, it’s probably because this wasn’t done.

Fun Fact: Did you know the sellers don’t have to disclose certain things?
People do not need to disclose if there was a murder, suicide, or the previous
owner had AIDS, unless you ask.

FINANCING

4 musts for financing:
1. Make sure the financing is approved and progressing.
2. Work closely with the loan officer.
3. Order the appraisal early to avoid delays.
4. Try to have the financing in order well before closing.

As rates go up, prices come down.

Fun Fact: In Scotland they paint their door red when they pay off their
mortgage, akin to our mortgage burning parties.
Fun Fact: 90% of home buyers financed their purchase.
Fun Fact: A home owner’s net worth is over 30 times greater than that of a renter.

INSPECTIONS

4 must have inspections:
1. Home inspection–it will surprise you what they find.
2. Pest/termite inspection–termites are more common that you might expect.
3. Appraisal–order this early.
4. Environmental study–often overlooked.

Beware of Superfund sites, flight paths, railroad tracks, etc.

Fun Fact: Appraisals are an opinion of value.
Ask 5 different appraiser for a value and get 5 different answers.
Did you know you are not entitled to an appraisal even though you paid for it?
As the seller you may never know what the house appraised for.

TIME

Timing is everything!
If you ask an appraiser or Agent “How much is my house worth?”
they will ask you “How fast do you want to sell it?”

Asking price: $1,000
Sold in 12 minutes.
Asking price: $200,000
Sold in 6 months

Anticipate the next deadline well in advance for a smooth transaction.

CLOSING

If you’ve done the rest right, this will go smoothly!
1. Understand the different ways to take title.
2. Arrange for the key exchange.
3. Review the documents.
4. Assume there may be a delay and plan for it.
5. Well in advance, understand what the closing costs might be.
6. Don’t do any “outside of closing” deals or kickbacks.

Fun Fact: The most expensive house sold in 2012 was $117.5 million dollars in CA.
Did you know brass doorknobs disinfect themselves? It’s the Oligodynamic Effect!

 

Anatomy of the real estate deal

Anatomy of the real estate deal