Busting 5 Home Buyer Myths

Purchasing a home is a big adventure and with any great adventure, comes myths. We have compiled a list of five of the most common myths and concerns for first-time home buyers.

Myth 1: It’s Cheaper To Rent

Reality: When you look at what you would be spending on owning a home vs. renting a home over a 30-year period, according to ATTOM Data Solutions’ 2017 Rental Affordability Report, buying a home is more affordable than renting in 354 of the 540 U.S. counties they analyzed. A home will eventually become an asset that can pay you in the long run. In addition, “making monthly house payments on a median-priced home — including mortgage, property taxes and insurance — is more affordable than the fair market rent on a three-bedroom property in 354 of the 540 counties analyzed in the report (66 percent).”

Rents will continue to rise and mortgage interest rates are still at historic lows. Before you sign or renew your next lease, meet with a local professional who can help you determine if you are able to buy a home of your own and lock in your monthly housing expense.

Myth 2: Selling On Your Own Saves You Money

A home buyer has choices on how to go about seeking a home. One choice is to find an agent who understands their requirements and takes them on a tour of the homes that are of most interest. They can also jump in their car, buy a newspaper or search sites on the internet and go out on their own. Why would a buyer do that? The most likely explanation is that they believe if they do the work, they can save the commission. A seller that chooses the “go it alone” route is trying to do the same thing. They both cannot save the commission.

If both parties could just split the fee, all would be acceptable, right? In theory, the seller can only gain if they retain the commission they are doing the work to save. The buyer can only gain if they obtain the home for less than market price. The great majority of us are not trained to engage in this negotiation and successfully close the transaction knowing we saved money. Both of these parties are missing the bulk of the market and the best selection. It is logical to reason home buyers and sellers utilizing agents have better odds of achieving their goals.

Consumers who consider the for sale by owner route may look hard at investing that same time commitment and instead learn how to evaluate a home, how to interview and choose a good agent and how to proceed through the real estate buying or selling process with a solid game plan. That way, they stand a better chance of protecting their hard earned capital.

Myth 3: Win A Bidding War By Offering More Money

While price is an incredibly important factor, particularly when there are multiple bids, there are other facets to a deal that are just as important. For instance, some sellers worry about the closing date, others want to keep certain items in the home, while others aren’t so keen on having major changes done to the property.

Before adding numbers to your offer, make sure talk to your agent. You may be able to offer a better deal without being the highest bidder.

Myth 4: Always Start With A Higher Price

During the first month to six weeks your home is on the market, more prospective buyers will see your home than any time later. Today’s buyers have educated themselves on housing prices in the communities they’re looking for, and won’t return to an overpriced home, even if the price is lowered. More likely, they will have already made a purchase. Setting a fair price initially will stimulate qualified buyers to make an offer during that initial time the multiple listing property is on the market. Real estate agents know how long a home has been on the market, and often choose to show their clients more recent Minnesota MLS listings instead of a stale listing.

Myth 5: You Don’t Need An Agent

You can find information about available homes on a number of websites — but real estate agents offer several advantages. They may have access to properties that aren’t listed, as well as have experience negotiating, which can be particularly helpful when buying your first home.

If you are planning to sell your home, let The Incorvaia Team make the process as easy as possible for you. Call us today!