First Time Buying A House

I've been helping a lot of first time home buyers, and have seen some common struggles. Buying your first home involves searching and putting in an offer when you've found a home you love. Just making an offer can be more difficult than most anticipate.

Searching

Looking for a good home can be either easy or difficult, depending upon the inventory and type of home. Typically, as of this day finding a great first home can take between one to two months of active weekly searching in the Bay Area. Finding something nice is not so much the problem as affordability and competition.

Making an Offer

This is the most difficult aspect for the first time home buyer, and for a good reason. This is one of the largest decisions someone can make in their life, and one involving a lot of money. Some will find a home that is perfect, but back out of making an offer, or make an offer that is too low and not get accepted. Typically, most first time home buyers in the Bay Area get two or three offers turned down before one gets accepted. This is a learning process and usually with more experience making offers people become more comfortable with making competitive offers. Houses for sale rarely get only a few offers, so it's important to keep in mind that others may be offering a higher purchase price and better terms. Having a great real estate agent for this process is important because they can advise you and work to negotiate on your behalf.

Getting a Loan

Obtaining a loan for your new home should definitely be on your mind before looking for homes, but sometimes it gets pushed aside as an afterthought. It's best to get a pre-approval letter which tells how much of a loan you can get to help you search with the right criteria and get your offer accepted (most sellers won't accept an offer without a pre-approval letter). For more on this, read my post "POWER to The Home Buyer."

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The Luxury Market

Large, beautiful and luxurious homes are built, purchased and sold every year just as with any home. Unlike selling the average home though, there are many more distinguishing and challenging aspects to these large, highly customized estates.

Price Point

Luxury homes are at the top range of all other homes in their surrounding area, which means that from the very start a majority of home buyers will not have the ability or desire to make such a purchase. Reaching qualified buyers is part of an experienced listing agent's job when promoting the house. Focusing on certain channels and areas maintains efficiency and gets the home the attention that it needs in order to sell.

Promotion

This requires much more than entering the listing on to the MLS. For houses near the median price range within their area, in today's market that can be enough to garner a lot of attention and bring in multiple offers, but as can be seen luxury homes are far from average so need the unique approach and attention to details that they deserve. Promotion strategy varies according to the type of property, but a good strategy will usually include: ads in the local paper, magazines, phone promotion, neighborhood promotion, worldwide listing exposure, broker tour and open houses. For homes that are eligible, they can be entered into luxury home websites and magazines for buyers from around the world looking for American luxury homes. With so many foreign investors and all cash buyers it greatly increases exposure and the ability to sell the home.

Days on Market

If you have ever searched for a luxury home, you have probably noticed that some stay on the market for many months. There are different factors which play a role, but the two primary ones are: the type of property (location, style, etc.), and the marketing that is being done. Regardless of how easy or difficult it seems selling the property will be, hard work and intelligent, focused marketing is a must. Experience teaches us that in the luxury market, anything can happen. Some properties seem like they will be hard to sell, and sell within a month. Others seem to be highly desirable but sit on the market for months. With that being said, a luxury home can sit on the market anywhere between a month to an entire year. Getting the right buyer to see it at the right time is the key!

Customization

These homes are highly customized, and many home owners spend thousands customizing. This makes each home incredibly unique, but also presents a challenge for when it is time to sell.

The home shown above is located in San Jose, CA and is for sale. Contact me for more information.

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