Theresa Reavis
Century 21 Bay Properties
Top Ten Real Estate Myths
Posted on February 4, 2009
I recently took a 4 day weekend away and didn't read one headline while I was gone. I highly recommend doing that once in awhile, because today's headlines are nothing but doom and gloom and the headlines today can send even the most optimistic person into a deep depression.
Just last week the Today show aired a segment on 10 Real Estate Myths for Buyers and Sellers. I'd like to share them with you since they were spot on with some of the questions I get asked on a daily basis. In today's market, fear runs deep on both the buying and selling sides of the fence. I'll start with the buyers.
Buyer Myth # 1: The longer the house is on the market, the more you can negotiate. When buyers ask "how long has this property been on the market?", they think six months means they can negotiate the price down. It more often means that the seller is stubbornly holding onto their price.
Buyer Myth # 2: The sellers today are desperate. Most aren't. Always ask why the sellers are selling. It's one of the keys to finding out how motivated they are. Having a job transfer is a very different situation than wanting to move up in size or price. The first homeowner is hot while the second can afford to wait.
Buyer Myth # 3: You can't buy a home with less than 20% down. FHA loans require only 3.5% down, and you can even ask the seller to pay the closing costs.
Buyer Myth # 4: You need good credit to get a loan. Again, FHA will lend money if you credit score is less than perfect.
Buyer Myth # 5: You shouldn't buy before the prices have bottomed. If only we had a crystal ball! Once you figure out where the bottom is, prices will be on the rise again.
Seller Myth # 1: Now is the worst time to sell! Not necessarily. It depends on where you live. Some of the worst hit markets are already starting to turn around. If you're a homeowner who wants to trade up the loss you may take on your current home will be made up when you get a bargain on the next one.
Seller Myth # 2: The first offer is never the best offer. A lot of sellers think it's better to hold out for something better. But 4 times out of 5 the first offer is the best you'll ever see.
Seller Myth # 3: Never respond to a low ball bid. Many buyers feel compelled to put in low ball offers to see if the seller will bite. If you come up with a reasonable counter offer, most buyers can be convinced to come up in price and make the deal work.
Seller Myth # 4: 'I can always reduce my price later'. Sellers often want to price their home high just to test the waters. Buyers shop a price bracket and if your house is in the wrong one, you'll just help sell everyone else's home while your's sits overpriced.
Seller Myth # 5: Before you refinance, shop around. You can if you want, but you will usually get the best deal from your current lender, and you can even negotiate closing costs.
This is great information for anyone considering buying or selling real estate.
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