‘Hold off, home prices are going down’
Why you might hear this: The predictions have been going on for years: The housing bubble is going to burst again; income is stagnant; the zombie apocalypse will free up stock.
Why it’s bad advice: Sadly, we have yet to find a Magic 8 Ball that’s spot-on when it comes to predicting the future. So if you want or need to buy a home, the time isn’t someday—it’s now. And “with a lack of inventory and the busiest time of the year approaching, home prices aren’t going down anytime soon,” says California Realtor® Tracey Hampson.
‘You don’t need to use a real estate agent’
Why you might hear this: See a home you like, then make an offer—how hard can it be? Cut a buyer’s agent out of the picture entirely and you’ll do just fine. Plus, with no agent to collect a commission, you’ll be able to negotiate a better deal with the seller. Right?
Why it’s bad advice: In a market where houses are moving so fast it’d give you whiplash, a real estate agent is indispensable. Not only will your agent know about properties long before you do, he or she can also guide you through mountains of paperwork, pointing out potential problems that could cost you big-time down the road.
“Also, though you may consider yourself a great negotiator, an agent’s knowledge and experience will help you get the house you want at the best price,” says Atlanta-based Realtor Bill Golden of Re/Max Metro Atlanta Cityside.
‘Just use the listing agent to represent you’
Why you might hear this: While listing agents work for the seller, they might offer to help you, too. What’s wrong with that? It certainly seems to cut down on the number of cooks in the kitchen, and maybe it’ll give you an edge in a competitive bidding situation.
Why it’s bad advice: You need someone in your own corner with a water bottle, cool towel, and an eye on getting you the best deal.
Put simply, “the seller’s agent represents the seller,” says Evelina K. Vatkova, associate partner at Partners Trust in Beverly Hills, CA. It’s akin to going to court with just one lawyer—one who’s working both sides of a case. You want someone who has your interests in mind, first and last.
‘Make a lowball offer and negotiate up from there’
Why you might hear this: Someone read Donald Trump‘s “The Art of the Deal” (while moving their lips, most likely) and thinks everything is a negotiation.
Why it’s bad advice: Making a major lowball offer can very often start negotiations off on the wrong foot with the seller. Worse, “you end up paying more in the end than you would [have] had you been more reasonable to start with,” says Golden. Serious buyers and sellers know what homes are worth.
Which leads to our next piece of bad advice…
‘Never pay full price’
Why you might hear this: Because only losers pay full price, right? (See: “The Art of the Deal.”)
Why it’s bad advice: There’s no such thing as absolutes in real estate.
“If a home is overpriced, you don’t want to pay full price,” says Golden. “However, if it seems that the house is well worth the money after carefully studying the comps your Realtor provides, paying full price may be the only way to get it, especially in a seller’s market.”
‘Remove contingencies to make your offer stronger’
Why you might hear this: A house has tons of bidders, and you want to be the most attractive to the seller.
Why it’s bad advice: In a competitive market, it’s tempting to feel pressure to cast off contingencies—you know, those safeguards where you agree to buy the home only if certain requirements (e.g., passing a home inspection or title clearance) are met. Of course sellers dislike contingencies, because they’re designed to protect you against utter catastrophe—say, your buying a home riddled with toxic mold or liens that will cost you thousands of dollars.
“Never remove contingencies unless you are 100% positive the property is the right home for you,” say Erfan Haj, an associate partner at Partners Trust.
‘Don’t bother hiring a home inspector’
Why you might hear this: You’ll spend a lot of money on an inspector to point out a leaky faucet. Besides, the home looks fine! Um, right?
Why it’s bad advice: Oh boy. That property that looks just perfect at an open house could be rife with issues only a pro will uncover. And saving those few bucks from skimping on an inspector could cost you loads down the line.
And Los Angeles stager Michelle Minch of Moving Mountains Design reminds us not to skip inspection even with a home warranty from the seller.
Tress Realty Group compiles some of the best real estate news, tips, and information for buyers, sellers and investors.