What Ebay can Teach a Home Buyer about Multiple Offers

I’ll have to admit, I can get a rush when buying things from an Ebay auction. After putting in a bid on something I cannot live without, it is exciting to watch the second count down to the end of the bidding. I don’t always win. In fact, it can be frustrating; I’ll throw in a good solid bid, only to be outbid in the final seconds. But I have watched and learned. In fact, I have now snatched an item or two from other buyers just a moment before the end of the auction too.

There are some important lessons that I have learned from online bidding that apply to a home buyer in a frenzied real estate market. 

As the real estate market has heated up a bit this spring in the Minneapolis/St Paul metro area, buyers are seeing many more multiple bids on homes. Home buyers don’t always have time to think and process whether a home is a good buy or not before someone snatches it up. This can lead to questionable decisions at the last second.

Lessons Learned from Ebay

1.    Know the Value Whether Ebay trinket or townhome in Hugo, you need to know the value of the item you are buying. Without research to know a good deal, there is a big risk of over spending on the item.

2.    Read the Fine Print Sometimes the information in the description, or in the case of a home the disclosures, can help decide how aggressive your offer should be. Recently, I had a buyer excited about a property but after reviewing the previously listing information which mentioned severe mold in the home (but was not in the current disclosure) my client decided to pass on the home all together. Don’t forego your due diligence or you could have regrets.

3.    Know Your Limit I have learned that in the last seconds of bidding, if I have not thought out what my absolute limit is on an item, I can risk overbidding and feeling ripped off. This also can happen in negotiating for a home. Some buyers just want to “win” the house but can feel buyer’s remorse as soon as the bidding war ends. It’s not a good feeling to overspend on a home. If you are financing the property, it will still have to appraise for the value. If it does not, you could lose the house if you do not have the funds to make up the difference. 

4.    It’s More Fun Solo As exciting as an auction is, it is much more fun when you are the only interested party. Sometimes when I really want something, I will just pay the “buy it now” price. With a home, it is easier if you can get your offer in before everyone else and avoid the multiple-offer situation all together. So as a home buyer, it is important to be working with a REALTOR® to be updated on homes that meet your criteria, non-contingent on selling your current home and pre-approved for a loan. This way you can get in first and write up your offer on the best homes as soon as they hit the market. It is good to be the only offer on the table.

Copyright 2013 www.terieckholm.com

Picture Perfect DREAM HOME with Harold's Purple Crayon!

Decades ago, when I was first learning to read, I loved picture book, "Harold and the Purple Crayon" by Crockett Johnson. I wanted a crayon just like that little boy who drew out his dreams in his footy pajamas. Even though I have never been a fan of the color purple, I always wanted one of those special violet Crayola-type sticks of wax to draw to draw my dreams. Imagine life being so simple.

After many years of wondering whether the dream of owning a home was dead, the housing market has made a turn around. Due to lower inventories in many areas, sellers are back in the  drivers seat and would be homebuyers are back to sitting on the fence dreaming about their perfect home. As interest rates start to creep up, the dream of a home could slip away. The reality is, there STILL are AFFORDABLE homes in the Minneapolis/St. Paul north and east metro. Maybe homebuyers just need one of Harold’s purple crayons so they can draw out a path to a perfect new home…

Draw YOUR perfect REALTOR® Grab that magic purple crayon and sketch out your ideal of a trusted professional REALTOR®. The first step in owning a dream home is to find the agent of your dreams to represent you throughout the process. Make certain to sign the buyer’s representation agreement for with a blue ink pen not a purple Crayola.

Draw Your Preapproval letter. Pre-approval is an important step before you begin looking for a home. It not only determines how much home you can afford to spend on a home, it guarantees that you are ready to write up the offer when you find your dream home. The letter will serve as notice to the sellers that the bank has committed to lend you a specified amount based on your financial history. This gives you significant buying power as a seller recognizes you are approved for a loan. Your professional REALTOR® can assist you in locating a qualified loan officer that will work with you to make your dream home a reality.

Draw YOUR perfect home!  Here’s the drawing you have been waiting for...glide that purple crayon across the page and sketch out your dream home. Your perfectly depicted REALTOR® will set up an MLS search for homes that meet your needs. As perfect homes hit the market, showings will be set to view the homes in person.

Draw up a Purchase Agreement and happy seller! Use that magic purple crayon to draw up a contract on your dream home. Okay the contract will more than likely be completed in something other than that crayon, but here is where you work with your REALTOR® to draw up a contract including all of the details such as what you want to pay for the home, what personal property is to be included as well as the date you want to close and move in.

Draw a Qualified Inspector. To be certain that you didn’t miss any important details when you sketched out the beautiful purple palace, draw a home inspector that is qualified to check out your new purchase.

Draw up a SOLD sign. A big purple "SOLD" sign will announce to the world that this is YOUR dream home! It will stay on the sign while the home is in "pending" status prior to the closing. During this period prior to closing, your dream professionals work closely together to ensure that details such as the appraisal and updating the title are handled in a timely manner. Now you can use a REAL purple crayon to cross off the days on the calendar until you get to the closing table!

Draw the Keys to your new front door! ! One final purple colored work of art will complete the home buying process—Sketch up a set of house keys! When closing day arrives, be prepared to attend with your state issued picture identification, a 10 year address history, your checkbook, and all other information requested by the closer. At the end of this meeting, you will be handed the keys to your new home.

Wait a second! Nobody really needs a purple crayon! You just need a trusted professional REALTOR® to guide you through the story to your happily ever after!

Copyright 2012 Teri Eckholm

Rebounds Not Exclusive to Basketball—Housing Prices have Bounced Back!

I have no ability when it comes to basketball but as a REALTOR® with well over a decade of experience in the Twin Cities north and east metro, I do know a housing rebound when I see it. Since last fall there has significant activity in the Minneapolis/St. Paul housing market. In the north and east metro, I have witnessed the market turn. The extreme low interest rates have brought out the first time buyers who have literally bought up almost all the listed houses. This is good news…unless you are a first time buyer.

Once again, there are multiple offers on home. In one situation I was in this past fall, there were 12 offers by the time the highest & best deadline arrived. Not familiar with the term highest & best? When there are multiple offers on a home, the seller’s agent notify all interested buyers to submit their highest and best offer so the seller can choose which one to work with. In this situation the seller’s agent said she had another dozen buyer’s agents contact her AFTER the deadline. More than 2 DOZEN interested parties on one home! This is driving prices up again.

 The real estate market has seen a rebound this market and it is good news for any seller that has been waiting for the right moment to sell.

Before the holidays, I was asked by a number of clients what they should do to do to get their home ready for selling in the spring. My advice was, “If you are ready now, go for it! Don’t wait until spring!” There is no reason to wait out the winter. Buyers are looking now and writing offers now as there are very few good homes on the market. The clients who took my advice saw their homes sell quickly…in many cases in just days.

Tips for Sellers in this Rebound Market:

• Get your home picture-perfect ready and on the market as soon as possible. Don’t wait as there will be more sellers competing in the spring.
• Stage your home. It will stand out compared to foreclosures.
• Price it right from the start. Just because pricing is up, doesn’t mean the sky is the limit on pricing. Buyers are too savvy…and so are appraisers! Trust your REALTOR® to help you find a realistic listing price.

  Tips for Buyers in this Rebound Market:

• Work with a REALTOR® from the start. I am able to find homes for my buyer clients and get them out to see them within hours of hitting the market.
• Get Pre-approved for a home loan. Sellers will not consider an offer without a pre-approval letter or proof of funds if it is a cash offer.
• Educate yourself on the market and work with an agent that knows the area so you won’t have to hesitate to write an offer. Waiting a few days to think about it may not work in this fast paced market.

Copyright 2013 www.terieckholm.com