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Things to keep in mind when making a lowball offer

Making a lowball offer can be quite tricky. There can be many considerations that are important to ensure that your lowball offer is not completely unrealistic. Here are some factors you need to consider:

1. Market knowledge

Depending on whether it is a buyer’s market or the seller’s market, you may or may not have competition or negotiating power. Generally, in a seller’s market, homes are in demand, and you are less likely to win a lower negotiation bid. In the buyer’s market, your chances of winning a lower bid are much higher. It is necessary to account market conditions when trying to anticipate a winning bid. Have your agent do a comparative analysis to get an insight into what other homes have been sold in that area and for what price.

2. Duration of listing

It is important to consider how long has the home been listed in the market. Keep an eye out on the listings, and you may notice that a particular listing keeps appearing on your feed for a long time, chances are that the owner may get desperate to get rid of the property quickly even at a lower price. Of course, before finalizing an offer make sure to get the home inspected to rule out any damages or problems.

3. Lucrative clean offer in lieu of a low bid

If you have a reason to believe that a seller may be quite eager to sell quickly, consider making a clean offer. Although the seller most likely feels that their home is getting sold for too less of a price, removing conditions like financing clauses will help you gain mileage.

Having a pre-approved mortgage in place before you start shopping can establish a cleaner and easier transaction from many perspectives. For starters, you may already know what your financial capability is and can bid accordingly without looking for a property that is too low or too high on the price. As a seller, it will be quite easy in making a decision if your buyer has a pre-approved mortgage that establishes their buying prowess.

4. Understanding the seller

Knowing a seller’s perspective goes a long way in buying the right property. Understand the seller’s reasons for listing their home. This can help you to formulate a strategy when placing an offer. For instance, if the owner is selling the property to move to a bigger place due to a job change or addition to the family, they may be quite eager to get the property out of their way and can be lured through a clean offer rather than just a low bid.

5. Be fair

As a buyer, it is important for you to know the lower limits for a property. You may want to avoid offending the seller or the listing agent by proposing a totally unreasonable offer. Bear in mind that every seller wants a fair earning, just like every buyer wants a great deal on the home. Be professional and conscious about it and avoid wasting everyone’s time with an unrealistic offer that can’t be accepted. Always regard the market conditions, seller’s situation, home condition and the length of time the home has been on the market, along with other related aspects to come up with a reasonable and tenable price offer.

Knowing exactly what offer is tenable and what is not can be quite tricky. Real estate experts like Cherry Yeung can help you to come up with a realistic offer and give you a chance to find your dream home at a great price.

 

Bidding War Rules

As the housing market gets more intense, with real estate agents handle 10, 20 or 30 offers at a time for a single property, the rules of a bidding war can get overwhelming, even for seasoned professionals. This guide on the rules of a bidding war, provided by the Real Estate Council of Ontario, is sure to help realtors get a handle on high demand property offers.

The Basic Rules

As a real estate agent, you have to disclose how many offers are currently in play to your client or anyone who’s already made a written offer for the property. You also need to tell your client whether or not you’re representing the property’s seller as well as other potential buyers, if you’ll be lowering the amount of cooperating commission and any changes within the bidding process. Now, while you can disclose the number of other offers on the interesting property, you can’t discuss how much that offer is.

Offer Registration

While buyers have a right to know how many offers are up for the property before submitting their own offer, the registration process can become messy when several offers are on the table. Since Bill 55 was passed in 2015, offer registration now requires that the listing agent can’t disclose other present offers until your offer has been signed. Brokerages need to keep a copy of all written offers and counteroffers, or an offer summary document. Finally, buyers who’ve made an offer can request the number of other offers to be presented to them.

Dealing with Pre-Emptive or Bully Offers

Bully offers are common in hot real estate markets when buyers are eager to get their offers in before anyone else. When dealing with pre-emptive offers, you’re required to tell your client as soon as possible unless otherwise informed. You need to have written consent from your client as to how to proceed for offers that come in before the offer date arrives.

Multiple Representation

In offers that have multiple representation present, there are certain guidelines that need to be followed. You’ll need written consent from the seller, the buyer and both brokerages when submitting an offer. You also need to tell anyone who’s put in a written offer that you’re representing the seller as well as the buyer. Lastly, if you’re the listing agent for the property and notice multiple offers that come from the same brokerage, it’s your responsibility to tell their agents.

If you’re looking to buy a condo in Vancouver, British Columbia, then you need to give Cherry Yeung a call, one of the top Burnaby real estate agents around. With in-depth knowledge about the Vancouver housing market and years of experience selling homes and condos in the area, you can’t go wrong with Cherry Yeung. With an incredible track record with her clients, call or visit Cherry Yeung’s website to get started on your house hunting journey.

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Hidden Costs When Buying a House

The expenses don’t stop once you’ve put an offer on a house and it’s been accepted. That’s just the beginning of what seems like an endless fountain of added costs. To make sure you’re not blindsided by the hidden costs that come with buying a house, here’s everything you need to know.

The Home Inspection

Paying to have a home inspection done is necessary after putting a serious offer on a home and having it approved. This will be your first big expense in the house buying process and it will determine whether or not you’ll keep the home or back out due to major unforeseen problems. Depending on the age and condition of the home, you may need to hire more than one type of inspector. As there are general inspectors, wood and insect specialists and sewer inspectors, scheduling one (or more if necessary) will run you hundreds of dollars per inspection. While it seems like a lot, it’ll prevent you from moving into a home that needs thousands of dollars of work to be safe and liveable.

Closing Costs

Once your offer has been accepted, numbers are crunched to determine what your closing costs will be. You can expect closing costs to be two to five percent of the house’s purchase cost. Closing costs include lender fees, the home’s appraisal, title fees, escrow fees and interest. There are calculates to give you an idea of what the costs may be in relation to your budget, so you can better prepare yourself for the extra expense.

Higher Utility Bills

If you’re moving from a small apartment into a decently sized home, then expect for your utility bills to be higher than they once were. It’s common for gas, electricity and water to increase once you move into a house or space that’s bigger than your previous one. Compared to renters, it’s estimated that homeowners pay several thousand dollars more in utilities every year. To determine how much you could be spending each year, see if your realtor can ask the seller to see a few of their past utility bills. While this may be a long shot, it’ll be the most accurate estimate as to what you could potentially be paying.

Ongoing Taxes and Insurance

Property taxes and home insurance always add up at the end of the day, and many monthly mortgage calculators don’t include them when determining your expected payments. Taxes and insurance vary depending on where you live, but it could easily add $1,000 or more to your monthly payments. It’s important to budget for this expense, as not paying it will land you in a heap of trouble.

Maintenance and Repair Fund

Repairs have to be paid for yourself when you own a home, as opposed to having a landlord fix the problem for free. While this is generally common knowledge, the amount of money that these repairs can cost is not. It’s easy to underestimate how much a leaky faucet or jammed disposal will cost to fix, especially if it all happens at once. There’s no single answer as to how much yearly maintenance will cost homeowners, as every house is different. Several sources are available to help you calculate these funds, but try to save about three to four percent of the homes purchase price to keep as your yearly repair fund.

With Cherry Yeung as your Burnaby real estate agent, you’re guaranteed to find the perfect home. Experienced and knowledgeable about the Vancouver real estate market, Yeung knows all the ins and outs of buying and selling in Vancouver. Whether it’s a house or condo, Yeung has an excellent track record and is dedicated to helping clients find their dream property. Contact Cherry Yeung, Burnaby realtor today to get started!