Resale properties India. Things you should never assume while buying a used home
Here are a few things to keep in mind when you are out to buy yourself your dream home from the resale market:
1) You are looking for the perfect home for your family. We say unto thee, there is no such thing as a perfect home. Whether you are buying a new home or a used one, perfection is a word that does not exist in real estate. Even if the present owner has used the home sparingly and with a lot of care, there will be dings and dents and things that you will need to fix.
2) Your dad or your best buddy knows best is not always true. You know how we seek a final approval from someone who we think knows better than we do? If you are a first time home buyer, its best to seek advise from someone who has done transactions in the real estate market recently. Its a dynamic situation and something from a decade back may not necessarily hold true anymore. If needed, seek professional help.
3) This house has been in the market for so long, there are no buyers thus and I can probably quote half the market rate and do the deal. Great conclusion. But not true. Apologies for busting another myth. The owner could be someone with deep pockets. If he has not sold it for a price below what he expects, chances are that he will not sell it to you either. The seller could be hard headed about the price. He could be frustrated by the long drawn process and ridiculous offers that the prospective buyers are offering for the property. Remember, the need to keep the house in showroom condition for months, having to put the house back on the market after one issue or another sinks a deal that looked so promising, having to put more money into the place to improve its marketability.
4) There are little issues that need to be fixed and the seller better do everything he can for the price you are paying. And your wife demands it! That could be a deal breaker friend. Remember that if you were on the 'seller end' and had made this investment expecting returns, you would have wanted to maximize your returns too. Add into the equation that moving is stressful, or that the seller is starting a new job or a new life, and it's possible that the seller will not be at his best behaviour or act illogically. He may react over a minor issue that you want fixed. Or if he feels slighted, perhaps he'll break off negotiations altogether. There comes down your pack of cards!
5) There is no way of knowing how a seller will react to an offer, so assume nothing. All you can do as a buyer is make an offer that makes sense to you at the time and see how the seller responds. Speaking of offers, many people believe they can make any bid they want, no matter how ridiculous, because it's a buyer's market. False. Even bank auctions of seized homes are never priced at half their value. Be realistic.
6) You have the money but you start with a ridiculously low offer for the property. That could be disastrous for you. Nine out of ten, you would cheese off the seller and he would not want to deal with you any more. Considering that the deal does happen, you would face numerous hurdles closing the transaction because the seller does not like you anymore!
7) Another popular misconception involves distressed properties and the notion held among many folks that buying one would be cheaper and easier than working with a seller who's under no particular pressure to ink a deal. When you're buying a foreclosure from a bank or dealing with a lender on a short sale, don't expect logical or rational decisions. Banks work on their own set of rules, have their own priorities. They make decisions based on the financials at the moment and usually don't consider the future costs of a delayed sale or the condition of the property. In fact, distressed sales often take much longer than normal to close if they close at all. And they are far more difficult.
8) Finally, when you like a home, try and buy it. Don't wait for prices to fall further especially in an economy which shows signs of growing.
That is all, folks! ;)
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