3 Step Approach to Selecting the Right Property

As real estate markets expand and contract, Buyers adopt different characteristics.  For example, in the three years following the bursting of the real estate “bubble,” the supply of homes (inventory) on the market was very high.  Instead of seeing the top 5-6 homes matching their needs & wants criteria, Buyers wanted to see as many homes as possible.  This approach reflected an “I don’t want to miss anything” mentality.  In addition, with so many homes available, Buyers tended to lack a sense of urgency and believed that the home they were considering would be available when they were ready to commit.  Unfortunately, Buyers learned that homes that are priced right based on market conditions will always sell quickly.  So, in many cases, the lack of urgency resulted in the loss of a great home option.

Today, in the Savannah real estate market, inventory is much tighter.  Homes are selling faster.  To capitalize on current market conditions, Buyers have to change the way they enter the home shopping process.  Specifically, Buyers should consider a proven “3 Step Approach” to selecting the right property, enabling them to act quickly when an opportunity arises.

Step 1.  Approach the home buying process objectively.  Yes, I know, buying a home is often more of an emotional decision than a financial decision for many potential homebuyers.  Objectivity is difficult to attain.  Nevertheless, there is no such thing as a “perfect home.”  I’ve worked with clients who built custom homes with significant input on design elements and, a year later, wished they had tweaked their own plans a little for this or that feature.  When a Buyers sits down with a Realtor and develops his/her needs & wants list, it is the Realtor’s challenge to seek and find homes that meet as many of the Buyer’s criteria as possible.  Success is generally declared if a Buyer can achieve 85% of the list, particularly if all the “needs” portion of the list are covered.  In any market, the good homes go quickly.  Buyer’s must accept that premise.  Doing so avoids a stall in the buying process driven by the “second guessing syndrome,” commonly referred to as Buyer’s Remorse.

Step 2.  After viewing each property, a Buyer should ask 3 important questions:

a.  What did I like about the property?
b.  What, if anything, would I want or need to change?
c.  If the price were right, could I see myself owning this property?  If yes, at what price?

I always encourage taking notes during a property showing.  This not only helps the Buyer focus on what he said he wanted, it also helps the Realtor gather helpful notes for feedback to the listing agent.  Further, if the properties viewed hit the Buyer’s needs & wants list, but the Buyer is answering “No” to considering the home as a viable option, the Realtor can then re-address the list and evaluate other key requirements the Buyer has not yet verbalized.  I often joke with clients that, at the end of every showing, I will ask, “Do you want to buy it?,” and then make them give reasons why the home does not work for their needs.  This process is helpful in continuing to clarify what the Buyer wants.

Step 3.  Remember you have 3 safety nets available.  The first is the Buyer’s judgment as an educated/informed Buyer.  One of the key purposes of the Buyer’s Orientation is to begin that educational process.  It may also include an orientation of what to expect in the desired neighborhoods, which helps a Buyer quickly grasp the value of a home during a showing in terms of its price and condition position within the neighborhood.  The second is the customized market analysis and review of public data that is done by the Realtor with the Buyer at the time of preparing the offer.  The data offers solid evidence of what terms are most appropriate for the transaction, helping the Buyer have a solid foundation of knowing that what is being offered is reasonable.  When data is insufficient due to lack of recent market activity, the Buyer has a third safety net available to gain security in the deal, i.e., the Appraisal Contingency.  Working with a good Realtor takes much of the insecurity out the process.

If you are considering a home purchase or would like to know more about the buying process, I’d be delighted to assist you.