10 Tips from a Frequent Home Buyer/Seller

Having been a party to about nine or 10 home transactions (buying and/or selling), I now feel qualified to pass along my experiences and lessons learned from them. Here are 10 tips so far. (I will probably put out another list at a later time.) There’s a lot to know and a lot of lessons learned. Hope you find this helpful.


1 – Have a Realistic Idea of What You Want and Can Afford

Many buyers start out their home search with a long list of “must haves.” They want those hardwood and/or tile floors, walk-in closets, granite countertops, stainless steel appliances, Jacuzzi tub in the master bathroom, fireplaces, and a host of other features that they have seen on shows on cable stations like HGTV. The reality is that some of these features are just showy and turn out to be not that necessary or practical. Stainless steel appliances are a dying fad that are just expensive, hard-to-clean nuisances (you get the same functionality as white, black, or colored appliances). Jacuzzi tubs tend to get used a bit when people first move in to a house and are then forgotten (they can also be a big expense to repair). As for the other items, they are fancy window dressing, obscuring what you really need.

The real must haves:

  • The right amount of square footage. Adding on a room is not as easy as it sounds, especially if the lot is not large enough or the foundation won’t support a second story. Having a lot of extra space means higher utility bills and maintenance costs.
  • The room layout you need. That in-law suite sounds nice, but is it really needed? And do you want to have the master suite on the ground floor while the kids’ rooms are upstairs?
  • A functional kitchen. Good cabinet and countertop space, working and clean appliances, an eating area, good ventilation and lighting.
  • The right number of bedrooms. Having shared a bedroom with siblings as a kid, I know it has its ups and downs. So you might opt for that extra bedroom or give serious consideration to a den or bonus room serving instead as a bedroom.
  • A room for the kids to be kids. Laughing, shouting, game playing, and other noisemaking activities just go with being a kid. But you may want to have those sounds off to a different part of the house where you can hear them but not be too rattled by them.
  • A room in which the parents can entertain guests. Mom and dad might want a cocktail party for co-workers, neighbors, friends, etc. Having that alcohol around minors would not be a good idea. They might like to play bridge and have in others to play bridge, too. Kid noises can disrupt their concentration on the game. And so on.

2 – Take the Property Information Presented Online With a Grain of Salt

Online listings for houses have one purpose: to get you to go see them. The number one feature for house searches on those listing sites is for properties having a minimum of three bedrooms and two bathrooms. So realtors do their best to make sure a house meets this, whether it does or not. They can also stretch reality a bit when checking off other features. Not all closets are created equal, and a walk-in closet that you can barely walk into is not the same as a walk-in closet the size of a small bedroom. An eat-in kitchen where you sit at a counter may not suit you the way an eat-in kitchen with room for a table and four chairs would.

Also, arm yourself by knowing the basics of real estate law where you are buying and/or selling. Realtors should have this covered for you, but in reality they are working for that commission and will naturally try to present a property in as positive a manner as possible while ignoring or even consciously avoiding its faults.

Some things to look out for:

  • What constitutes a bedroom? In California, a closet for hanging up clothing is required. In some pioneer states it is not. An older house may be grandfathered in, especially in an area with a lot of older houses that were built before our modern style of clothes closet was standard. (Our current house was listed as having three bedrooms and two bathrooms. It was built in 1930. One room has what we today would call a clothes closet with a rod for hanging clothes. No other room in the house has this or anything even close. So technically it is a one-bedroom house.)
  • What counts as square footage? Check the square footage measurement in the listing, an area where a lot of fudging routinely is done. Does it include any areas that are not serviced by the HVAC system? Example: An enclosed back porch that has a separate window air conditioner and a wall-mounted gas heater should not legally be included in the total square footage of the house (but it was in the house we are in now).
  • What constitutes a full bathroom? A three-quarters bathroom? A half-bathroom? A powder room? In some areas they have (respectively):
    • a tub/shower or separate tub and shower, a toilet, and at least one sink/vanity
    • a shower, a toilet, and a sink
    • a toilet and sink
    • and a toilet, a sink, and a dressing table where you can sit down and “fix your face”
  • Get a survey done of the lot, no matter what. You may want to put in a fence later or add a garage, etc.
  • What is the seller responsible for telling you when buying a property? It should be in the listing and/or the property disclosure statement that most states require. But a meeting with the sellers before you finalize the offer could be a very good thing and something that realtors have been actively squelching.

3 – Select a Realtor with Care, Whether You Are Buying or Selling

The realtor is often your key to a buying and/or selling experience that is great or terrible. They market themselves as being compassionate and helpful, but we all need to face the reality. And I, for one, prefer it. That reality: Most of the time realtors are working for themselves, doing what they can to collect a commission. I don’t mind that the realtor wants to earn a living. He/she should. At the same time, though, that realtor has an implied commitment to you and me, their clients, to represent our interests.

CAUTION: Going for the realtor who is good at public relations and has his/her name splashed all over radio ads, billboards, and flyers at grocery stores is not usually the best choice. If they also have a “team” working for them, it’s even worse.

  • A top realtor with Re/Max, Raleigh, NC – ran radio ads, came over eagerly to get us signed up to list our house for sale, then handed us off to her team (who were supposed to be behind the scenes as she had clearly told us); after that she wouldn’t take our calls, even as the deal with the buyers was getting abused. She cost us $2,300 (and it could have been double that but I finally put my foot down and insisted she come to the phone – she put us on speaker phone and had her attorney in the office but didn’t tell us until we heard him cough).
  • Another top realtor with Re/Max but this time in Cary, NC (a suburb of Raleigh) – she hardly wanted to deal with us once the listing contract was signed, but we refused to deal with her assistant other than for paperwork matters; even so she ended up costing us $7,100 ($5,000 buyer’s closing costs that she harassed us into agreeing to, plus a $2,100 refrigerator that we were going to sell but that the buyers wanted and again she pushed us to agree to).

And then there are the “buyers only” realtors. Most realtors end up on the side of the sellers (with the realtors above being notable exceptions). So some buyers have gotten attracted to realtors who advertise themselves as working strictly for the buyers (in reality they usually just don’t want the hassle of handling property listings).

When we first moved to the Raleigh, NC, area, we used Homebuyers, Inc., which seemed like a smart move. We actually dealt with them twice, despite issues with the first transaction. Here’s how it went:

  • First time: The realtor worked with us diligently, visited properties, sent photos, found out information about the properties, etc.; all seemed to go well, but after a year in the house we found out what the realtor had NOT done (had not assured that the inspection was done properly, had not scoped out the neighborhood, had not looked into resaleability of the house – all things that hurt us when selling).
  • Second time: Buying our next house after selling the first one. We needed one that was a bit larger, newer, and supposedly in a better neighborhood. This time he had a bigger deal going and did not want to spend much time on us, with the result that we overpaid for the house and didn’t get the terms we should have.

4 – Be Honest With Yourself and Your Realtor

They say honesty is the best policy, and that is very true in buying and selling houses.

When selling, be sure your house is listed correctly. When buying check out everything in the listing to see if it is accurate. Realtors are afraid of being sued and have gotten into the habit of knowing as little as possible about the property they are listing or the properties they are showing to you as a buyer. A claim of ignorance is the goal. While ignorance of the law is not seen as a defense in any court in the U.S., apparently ignorance of a property’s true condition is just fine.

When buying our current house, the realtor was new, had two very young (2- and 4-year-olds) children in tow, didn’t know or care to check things out for us, even when directly asked to do so (such as measuring the bedroom). [Note: We were unable to make a trip out here to view the property before buying, and even if we had, we might not have had time to be here during the entire process. Long story. The important point is the realtor had agreed to act in our stead on all matters relating to the purchase.] She also hid from us that the two title companies whose numbers she gave us had merged a couple of months previously and so we were in essence denied our choice of title company to use, a violation of state law, and ended up dealing with the person who was too important to speak to us on the phone (she also kept the sellers out of the room – rather suspicious and appearing to mean that something was being hidden from us about the property).

5 – Be Aware That No Two Real Estate Transactions Are Alike

The difference between buying and selling is vast, but so is the difference between transactions. Here are a few reasons why:

  • State – laws for real estate transactions vary from state to state. The worst is California, the easiest is anybody’s guess. One of the most ridiculous things we’ve ever had to do when selling was sign a statement that there were various critters that lived on and/or near that property. Well… duuuuuuuuh! It’s planet Earth! But that’s California.
  • The local market – if demand is high and the number of houses is low, then you have a seller’s market where they can set any price they like (such as in the San Francisco Bay Area); low demand (few buyers) and lots of houses for sale means a buyer’s market where they can get by with things like demanding and getting $5,000 in closing costs paid by the seller plus an expensive refrigerator staying with the house.
  • Your price range – selling a house in a neighborhood of smaller houses can be far worse than the reverse; selling a multi-million dollar property involves dealing in some high finance.
  • Time of year – you can sell any time of year, even during the time between Thanksgiving and New Year’s Day; you’re more likely to be in a seller’s market if you list in that holiday season rather than in Summer.
  • Select the closing company with care. Just about every state in which I have either bought or sold property has a law that says the Buyer chooses the closing company. They are the folks who make sure everything is done correctly in accordance with the sale contract.

6 – When Selling Resist the Advice of Professional Home Stagers

You want your home to look nice when it’s “on the market” (listed for sale, as we mere mortals say), at least enough so that potential buyers will come inside and look around. (Yes, there have been houses where we looked inside the front door and said “No way!”) But this home staging routine that realtors have begun pushing on home sellers is pure and simple nonsense. See this article with a link to my guide about what you really need to do to get your house ready to sell.

7 – Home Warranties Don’t Benefit Either the Buyer or the Seller

Realtors push a seller into offering a home warranty when listing a house for sale. They say it will attract more buyers. Buyers are then told by realtors that they should go for houses that say a home warranty is offered. In reality, in both situations the realtor is just covering him/herself from possible lawsuit. And the seller pays out a couple hundred dollars needlessly.

How home warranties work: A home warranty is meant to cover major items in the house. The home warranty company sets up contracts with various professionals, getting them to agree to discounted prices for their time and labor. The buyer pays a fee to that professional just to come out and look at the issue. If it is something that can’t be fixed right away, the buyer could end up paying that fee again when the professional comes back to finish the job. It could be cheaper for minor repairs to fix it yourself (we found that replacing the water heater that broke while our house was on the market was cheaper when we did it, plus we could select the plumber to do it). Plus many professional plumbers, electricians, etc., don’t even like to deal with home warranty companies. They are often underpaid or not paid at all; the home warranty companies will often only want the bare minimum work done to keep something running.

Rather than demanding a home warranty, it’s better for you when buying a house to get a professional HVAC man out to inspect that system, an electrician to go over the wiring, a plumber to go over the plumbing, and so on. Many of these folks don’t charge a fee for this or they only charge a small fee. But it will save you a big headache in the end. This is true for houses of any age (new construction can be far worse than an older home).

8 – Check Out the Neighborhood Thoroughly

Houses don’t exist in a vacuum. And even if you are buying in a development or an area with a Homeowner’s Association (HOA), you will want to know a little something about the people living in the houses around the one you are considering buying.

A few things you can do:

  • Take some time to meet some of those prospective neighbors.
  • Check the police blotter in the local paper to see if any of those neighbors was arrested (realtors are so afraid of being sued that they won’t even get into things like this with you, so it’s all up to you).
  • Walk around the neighborhood and hang around awhile to see what happens and if you hear a lot of dogs barking and other unpleasant sounds (many garages get used for band practice).

9 – Check Out the Homeowner’s Association (HOA) Thoroughly

Homeowner’s Associations (HOAs) have been around a long time now. They were originally intended as a way to assure that your neighbor didn’t do something that would drag down your property value. Things like not taking care of his lawn, not keeping the house maintained, engaging in loud and/or annoying activities, etc. They have developed into a very hit-and-miss idea where their effectiveness depends in large part on the people living there and who take the time to be active in HOA management. Usually, it’s the real controllers who fear their neighbors and who think those neighbors, if not controlled, will do something to make life for those around them a living hell. (No, that’s not an exaggeration, having dealt with such people first hand.)

As a buyer, you need to do the following:

  • Research that HOA to see what their bylaws are (some states require that you get a copy to read and sign off on, and that you could cancel the purchase contract if there is something objectionable in those bylaws).
  • If the HOA includes facilities like a pool and clubhouse, be sure to check them out to see what general condition they are in.
  • Get a copy of their financial statements to determine if they have enough reserves to cover any major repairs to those facilities and any other items for which the HOA is responsible (some do their own street maintenance). Insufficient financial reserves could mean a big bill (special assessment) from the HOA to homeowners for covering those expenses. Or it could mean a big increase in your monthly fee (regular assessment).
  • Search online for owner complaints against the HOA. You will quickly learn which complaints are legitimate versus the crank ones.

10  – Don’t Rely on Home Inspectors When Sizing Up the Condition of a Property You’re Buying

A home inspection is always touted as a must by realtors. In truth once again they don’t want to get sued (I can’t say this enough – it is a huge motivating factor in what they do or don’t do). In fact, the less realtors know about a property’s condition, the more they seem to like it and the safer they feel. (Hint: Don’t be fooled. You can still sue. And you will very likely win.)

When inspecting a home you are buying, home inspectors always seem to miss big stuff and point out useless stuff. (For the house we now own, the inspector pointed out that some outlets were the old style without the ground but missed that all of the wiring in the old part of the house both in the attic and under the house was knob-and-tube, which was a big expense to replace and would have given us leverage to negotiate a lower purchase price. He also missed the poor condition of the water supply lines under the house that were clearly visible where galvanized pipes were connected to PVC pipes – we had some of these connections burst about a month after moving in.)

When inspecting a home you are selling, they always seem to make mistakes, not even knowing what they are seeing. (A garage air vent on the house we recently sold was touted as a vent into the bonus room over the garage with a recommendation to seal it off. This would have posed a hazard to the buyers had we agreed to do this since the vent was really going straight up out of the roof to vent exhaust fumes from cars and from the gas water heater.)

On the Plus Side

This isn’t meant to discourage you but to prepare you, especially if you are a first-time buyer. Hope it helps!

© 2015 A.C. Cargill photos and text


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