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Below are some key questions that buyers should have their agent find
out for them...
1) Why is the seller moving?
This will help the buyer determine the seller's motivation, unfortunately sometimes even the listing agent doesn't know. It is important to find out why the seller is moving in order to make an offer that will meet their needs. For example, maybe the seller wants to move quickly due to a job transfer or relocation. A short escrow will help the seller choose the buyer's offer over others with a longer escrow period.
There are real estate agents that believe the seller's reason for moving is none of the buyer's business and that is not true. If there is a financial hardship reason, such as foreclosure, then the buyer has the right to know and to prepare for a quick close of escrow. Another example would be a divorce, which can prolong and make some negotiations difficult and emotional. If the buyer knows why the seller is relocating, it can be an advantage for both parties involved.
2) How did the seller and seller's agent arrive at the sales price?
An experienced listing agent will have prepared a CMA (comparative market analysis) of the property and be willing to share that with the buyer and buyer's agent in order to make the sale. The CMA shows recent sales prices of comparable homes, the list prices of competitive neighborhood homes currently for sale, and the expired list prices of homes that did not sell. After analyzing this information, with the help of their real estate agent, buyers can quickly determine if the home is overpriced or under priced.
3) How much did the seller pay for their home?
Your agent can pull the tax records for the home and tell you how much the seller paid. This is valuable information because it also provides not only the sales price paid, but the closing date as well. Would a house be worth $100,000 more if bought 6 months ago? In some markets yes, but this information will provide buyers with how much negotiating room based on the equity. Buyers should be advised that the purchase price has nothing to do with today's
market value of the home.
4) Has the seller provided their agent all the "Disclosures" to the property, including the Transfer Disclosure Statement?
California requires sellers to prepare a written disclosure of material facts about the home. Sometimes it is prudent to ask your agent to view a copy with you, prior to making an offer to purchase, depending on the property. Many times properties are offered, "as is" - meaning the seller will not pay for any repairs. The seller and the listing agent still have a duty and obligation to disclose all material facts and defects of the property. If the defects are severe, the buyer may either cancel the offer or ask for a discount off the purchase price
to repair those items.
5) What past problems has the seller had with the house?
This coincides with the Transfer Disclosure Statement mentioned above. But often times the seller will repair the problems and not disclose them if they have been repaired. Seller disclosure forms often do not require disclosing past problems that have been corrected. There may be some things that have been fixed that you want to know about. For example, major structural problems, plumbing and electrical defects, roof leaks, fire damage and drainage problems that might reoccur. It is better to know about them ahead of time.
6) Are there any neighborhood noise or nuisance problems?
Have your agent ask the seller and/or the seller's agent and I would still recommend that you visit the neighborhood and walk around at different times of the day to get a "feel" for the community. Is the seller moving because of a neighbor's barking dog or is there freeway or airport noise? These factors can affect the future value of the property.
7) What are the crime statistics for the neighborhood?
Have your agent check the records or give you the website information or phone number to check with the police department. Not only can high crime in a neighborhood affect your safety, but also the future value of your property.
8) Has there been any litigation?
Construction litigation has been a problem in Southern California and can hold down the property values of a neighborhood. Has the litigation been settled, has the work been completed? How serious were the construction defects?
9) How are the schools in the neighborhood?
If you have or plan to have children, this is an important question, have your agent check the school statistics and rankings. Asking the seller will usually provide you a candid response and "tips" of what to look for in choosing a school and or teacher. Nothing adds more value to a neighborhood than fine public school ratings and nothing can hurt an area more than poor public schools performances. Sending your children to private schools is expensive, so be sure to check out the public schools during the contingency period.
10) What did the seller like the most about their property and the least?
After living in a home, everyone usually has an idea of things they would change or improve on. Asking the seller prior to their move, might help you change those features that would better enhance the property and it almost may help you make the decision whether to buy it or not.
Most importantly.... don't be concerned about asking the seller questions... this is a big investment and you want to have as much knowledge about the home as possible!
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