After saving for years and searching for months, you finally found a home that best reflects your needs and fits your budget. You immediately phone your real estate agent, who sets up a showing for that night. To prepare, your agent sends you information on properties in the area that were listed recently or sold within the last month. “Great,” you think, “I have everything I need.” Not so fast.
Realtors are industry experts. Getting paid by commission means they are working to help you buy the right home for the right reasons and that includes information that is not so easily accessible. Market comparisons are one aspect of this, but so are answers to other pressing concerns such as how the neighbourhood has changed over time, what future developments are planned, and why is the seller choosing to list their home at this point in time?
“As a consumer today, there is a great deal of information out there,” said Zolo-founder and West Vancouver agent, Barry Allen. The key, adds Allen, is to really use your market expert so that you can make the best decision for you. How should you do this? Jot down these five important questions and remember to ask your Realtor for their expert advice.
What can you tell me that I don’t know?
Although it seems like a general question, it’s always a good idea to get the juices flowing. Your Realtor might have information that you don’t but has yet to share it. For instance, you know the current list price but do you know what strategy the listing Realtor is using. In hot markets that favour the seller, a listing agent may underprice a home in order to initiate a bidding war. At other times, the home for sale may be part of a divorce settlement, meaning you need to give the sellers ample time to discuss and come to an agreement.
These are all vital pieces of information that you simply can’t Google, says Allen. “But a good realtor can get this type of information for the buyer.” Having a realtor who can provide you additional information helps you make better buying decisions.
What is your opinion on this neighbourhood?
You might already have a good idea of the neighbourhood you plan to buy in or maybe you’ve done a tonne of research, but not all details and neighbourhood characteristics can be found through an online search or by staring at statistics. For instance, just because a school gets a good score in various school rankings, such as the Fraser Report, doesn’t mean it’s right for your child, explains Allen. “What the ranking can’t tell you is how many resource teachers they have, whether or not the staff is overworked, or if this particular school just an injection of funds and resources in order to help the students.”
Getting deeper information about a community is critical and one of the best experts to provide this information is your Realtors, explains Vancouver mortgage broker, Atrina Kouroshnia. She adds that the information you get from your agent —like whether or not there are popular walking trails or off-leash dog parks nearby — may end up affecting your house-buying decision. “If you plan on renting the property out later on, or getting a pet, you should discuss this with your realtor, who can help you decide if these future goals are achievable in that neighbourhood or this house.”
What are some future developments that I should know about?
Want to know what the community will be like in five to 10 years? Then consider how that neighbourhood is growing and developing. “If there are plans to build a Whole Foods store next to the building then chances are your neighbourhood will thrive and grow, which is great for anyone concerned about future property values,” says Allen. On the flipside, any future developments that end up blocking that beautiful mountain or downtown view will certainly detract from a property’s perceived value. For that reason, asking your real estate agent about possible significant developments that may be on the horizon both short and mid-term would be a smart move. “In the world of stuff that a realtor should know — short-term to mid-term development in the neighbourhood is critical,” explains Allen.
What have previous properties in this neighbourhood sold for?
While most agents are very quick to point out comparable properties, it never hurts to ask for this information. Most home buyers are currently not able to access this data on their own (although this may change sometime in 2018). Knowing what similar properties and even not-so-similar homes sold for can help you make a better buying decision. “We all know that the home on the corner was listed for $1.25 million,” said Allen. “But the next day when the ‘for sale’ sign disappears, and the listing is removed from MLS, we have no idea how much it went for.” Your Realtor will have that information readily available and knowing that a home recently sold for under asking price or that multiple properties have gone above asking price is valuable information for a buyer considering an offer.
What’s a reasonable offer price?
Knowing what other properties sold for in the neighbourhood is good information, but you’ll also want to know what a realistic offer will be for the property you are interested in — and this really depends on the hyper-local market, says Allen.
“In a heated market, you want to present a realistic offer that lets the seller know you are serious,” said Kouroshnia. “A good agent will work with you and come up with a purchase price that matches that market.”
Of course, jaded criticism about the role of a Realtor argues that agents only care about pushing the price higher and higher, but that’s simply not accurate. The best strategy, according to veteran agents, is a winning strategy and that doesn’t always translate into the highest price. To close a deal, an agent needs balance the buyer’s needs with the market expectations — and a great agent will work hard to make this happen. Ask your Realtor these five important questions so you can arm yourself with as much information as possible before making a critical and expensive home buying commitment.