How Do You Buy A Home?

The Savvy Synopsis

Perhaps you understand the homebuying process in theory, but what’s the actual first step? Then, when it comes to selling your home, how much will it cost? Angie answers both of these questions as well as one more from the mailbag.

In today’s episode of the Savvy Realtor podcast, Angie answers three questions from the mailbag, all about buying or selling a home. From where to begin to selling it later on, hear her talk our listeners through how to best proceed with the homebuying process.

A single mom of three asks Angie, how do you buy a house? After years of rentals, this listener is looking to buy a house of her own but isn’t sure where to start. So, what do you do first in the homebuying process? To begin, find a real estate agent you trust and then meet with a lender. Get pre-qualified for financing and get guidance on what price range to look in when shopping for a house. (Don’t forget about all of the closing costs!) From there, your real estate agent should be able to help you start your search.

Frank in Chapel Hill wants to know, how much does it cost to sell a home? There is not a set standard commission, so check with your potential real estate agents to find out what theirs is and what that gets you. In North Carolina, the norm is that seller pays total commission for both the buyer and the seller. Additionally, there are a number of fees and dues that may go into the cost of selling your home. When working with a client selling a home, Angie’s team makes sure to address the list price, the costs, and the net worth.

When buying or selling a home, how do the comps get calculated? All real estate agents should be using the same system within the area. To find out the comparables of other homes in the area, the Triangle MLS is looked at, as well as similar square footage and similar styles of homes within the past year to determine a home’s worth. But that said, it’s not so simple as just looking at a system. Digging deeper and factoring in several different features to find the most accurate price point is required. Watch out--the more appealing sounding number from one real estate agent vs. another might not be the right one!

Listen to the full episode or click on the timestamps below to hear the answers to this week’s questions from the mailbag.

0:38 - Mailbag: How do you buy a house? Start with a real estate agent.

1:57 - If you’re planning on getting financing, meet with a lender.

4:50 - Mailbag: How much does it cost to sell a home?

8:49 - Mailbag: How do you determine “comps” when determining list price for a home?

10:23 - A real estate agent has to understand how to pull comparables on a home.

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The Host:

Angie Cole - Contact - Call: 919-538-6477

Show Transcription:

Note: This is an automated transcription. Please forgive the robots as they tend to make some (a lot of) mistakes...

Speaker 1: (00:02)
It's time for the savvy real tour podcast. I'm Walter Storholt alongside Angie Cole, the owner and broker in charge of a Cole Realty serving you throughout the triangle, teaching you about the ins and outs when it comes to buying or selling a home. You can find the team online by going to eight Cole that's a C O L E or by calling (919) 578-3128 that's (919) 578-3128 and now it's time for one of the top real tours in the triangle, Angie Cole and the savvy real tour podcast. So if you want to submit a question to be featured on a future show, just go to a Cole and you can submit your questions there or on social media. Of course. Just look for Angie colon. You can give us a shout there. Gloria has our first question in the week and few Quaive arena and says, this might sound basic, but how do you buy a house? I've been a single mom raising three kids in rental homes. All my life, but they're all grown and I don't need this large apartment rental anymore. I'd like to get a little house of my own. So what's the best way to get started? It sounds like somebody who's had that dream for a long time.

Speaker 2: (01:11)
Yeah. And you know, that's not an uncommon question. So you know, Gloria, you don't feel silly about asking that and clearly you don't because you, you know, approach us on the radio here. But, um, I get that question all the time as far as just where do I start? But first steps, I would say definitely connect with a real estate agent, you know, uh, who you feel like is a good fit for you because your real estate agent typically should be able then to guide you on what other providers you should be connected with. You know, because for example, our team, we have preferred lenders, we have preferred inspectors, you know, people that we work with, we know are wonderful at what they do and is going to be really easy and beneficial working with them. So first, start your conversation with a real estate agent.

Speaker 2: (01:53)
And of course Aiko Realty would love to be your go to. And then from there, if you're planning on getting financing, we would love to connect you with one of our preferred lenders. That's always the first step. Now if you're paying cash, all we need to see is a proof of funds. But if you are obtaining financing, let's start the process. Let's get you prequalified. And the importance of that is a lender. Not only will they tell you what you're approved for, but they can also give you guidance on what price range to search within. Because say you can afford a $300,000 home, but after looking at what your mortgage payments will be, you have determined that, you know what, maybe I really shouldn't go above two 50 max. You know, because just because you can qualify for a certain amount doesn't mean that you want to max that out.

Speaker 2: (02:38)
So a lender can really give you guidance on, you know, the amount of down payment. You potentially need money to close what your mortgage payments will look like. You know, just to make sure you truly understand the financial aspect of buying a home. Then from there, once you have that pre-call letter in place, our team can run with it. We'll chat all about your housing search, get you set up or your housing criteria, get you set up on a search, you know, start getting you out there looking at homes and take it from there. So again, first steps when getting started is connect with an agent you want to use. And then from there allowed them to give you guidance on what vendors you probably should start conversations with.

Speaker 1: (03:16)
Yeah, it's a great point as well. And, and Gloria, that's gives you kind of the basic layout there. I think it would also be helpful maybe to pick up Angie's home buying guide. Uh, this guide is definitely designed for somebody who's really at the beginning of the process and has some of these intro questions.

Speaker 2: (03:32)
Yeah, most, most definitely. So, you know, we offer a home buying guide and it's just a downloadable guide that walks you through the steps of purchasing a home. So from start to finish, even after the close, you know what are the steps just so you always feel like you are ahead of the game. You know what's coming up next. And our team is great at doing that with hand holding, making sure we're always one step ahead of you so you don't feel lost throughout the process. But if you would like to go ahead and just kind of zip through and understand what the home buying process looks like, you can receive a copy of our downloadable home-buying guide. So to receive that, just text the word contract to the phone number five five five eight eight eight. So once again, if you are thinking about buying a home and you want to understand the steps from start to finish, just text the word contract to the phone number five five five eight eight eight

Speaker 1: (04:22)
very useful guide. A lot of people text to get that each and every week. So go ahead and do it. If you haven't done it before, whether you're a new listener to the show or you've been around for a while, just text the word contract to the number five, five five eight eight eight and we'll text you right back with a link to click on and you can access the guide right away from your phone. Very easy to do if you want that home buying guide from Angie Cole and the team at a Cole Realty. Just text the word contract to the number five five five eight eight eight. Got another question here. Angie. This one's from Frank. Uh, Frank is in chapel Hill and it's a very short question. Maybe the shortest question we've ever had here on the savvy real tour. How much does it cost to sell a home

Speaker 2: (05:01)
question, Frank? So I'm assuming you're asking, you know, not only about commissions, but what else is included with selling a home. So, you know, first of all, commission and there is no set standard that's actually like illegal in the real estate world to have a set standard on a commission rate. So that's something that you need to discuss directly with the agents that you interview. You know, and truly understand what that commission means is far as what does that get you, you know, what type of marketing are they doing for you? You know, why are they charging what they are charging? Um, because you know, an agent, of course we, we earn commission or we own earn, you know, pay your income just like any other profession because of the services we provide. And those definitely should be top notch for you above and beyond the like commission or marketing fee that you're paying to the agent that's representing you.

Speaker 2: (05:46)
The norm in North Carolina is that the seller pays total commissions. So that means not only are you compensating the listing agent that's representing you, you're also the buying agent that is precurring the buyer. So once again, not a requirement in North Carolina, but that is the norm in our area. That seller pays total commissions in North Carolina above and beyond the commissions. There are other closing costs that a seller needs to pay. Of course the buyer has their own closing costs, but a seller has some closing costs as well. So you have items such as your tax revenue stamps, which is 0.2% of the purchase price that is required by any seller in North Carolina. That's a tax that everyone must pay. You also will have things such as your deed prep where the attorney is preparing your seller documentation. There's going to be some recording fees where the court house, you know there might be a small like wire fee for either payoffs and also wiring any proceeds to you.

Speaker 2: (06:46)
There's also going to be a proration, so if there are unpaid taxes for the year of when you own the home, you need to pay your portion of taxes. Also, any unpaid HOA dues you have to pay for your portion of homeownership. They are, if you've already paid those, you might actually get a credit back to you. And then the other main item that I see is kind of a newer thing, but with HOA is if you have an HOA in your neighborhood, some HOA management companies are now charging an admin fee that most I might see like $100 or so. But that's also something that's tacked onto the seller and it's just a transferring of documentation from you selling your home to the next time at are. So those are the typical closing costs that go along with selling your home. And it's really important as a seller to definitely understand not only what you will sell your home for but what you will truly net.

Speaker 2: (07:39)
And that's one thing that our team definitely does. When we meet with you, we go through comparables and from there we give you guidance on a list price, a sales price, and we give you an idea, we give you a range, we actually show you an Excel spreadsheet of if you sell here, this is what you will net. And all of those items I just mentioned are detailed out on your net proceeds sheet. And so if you are thinking about selling your home, Frank, it sounds like you might be or just anyone who's listening, if you're thinking about selling your home, I know of course it is super important, most important, understand what you net, but also you probably want to get an idea of what your home is worth. Um, so if you are thinking about selling your home and you want to get an idea of what your home is worth in today's market, and I know we're about to be in 2020 but if you want to get an idea of what your home is worth, just text the word listing to the phone number five five five eight eight eight and from there our team will send you a tax.

Speaker 2: (08:30)
Make sure that you click the link, input your dress, and then from there we can give you an idea of what your home is worth. So once again, if you're thinking about selling your home and you want to get an idea of what your home is worth in today's market, just text the word listing to the phone. Number five, five, five, eight, eight, eight.

Speaker 1: (08:49)
Travis is writing in from a Durham and says, I'm curious how you determine comps when creating the list price for a home. Do all agents use the same software to pull those comps or is it more of an art than science and might vary agent to agent?

Speaker 2: (09:06)
Yeah, great question Travis. Um, so first of all we should all be using the same system within our area. Um, so we use the triangle MLS, which is our multiple listing services database. Um, we should be using that sometimes or actually every time. I also go to the County website too to look up specific information, but for example, it's really easy on wake County, a website to also see recommended sales that they say are similar to your listing. Um, but the main software that we're using is the triangle MLS. Then from there we should be looking at similar square footage, similar agents, similar style. Um, and then we never look at a year of pass, a year of close sales. Reason being is, you know, data is inaccurate and outdated when we go beyond a year. And if you are obtaining financing, uh, an appraisal is ordered and the appraiser's doing the exact same thing that we're doing.

Speaker 2: (09:57)
So we need to look at like homes and then you try to get, you know, within his close of distance as the like subject property or the home that you're looking to sell when it comes to pulling comparables. And so, but when it comes to is it an art more than a science, you know, you look at numbers but you really needed them give, you know, credits for thumb, some things, deductions for others, you know, and you need to understand how to pull comparables. It's not so simple as just the system's doing the work for you. You then need to dig deeper. You need to look at the specifics of the home. Is there a garage, how many bedrooms, how many bathrooms, what's the acreage, what's the condition of the home? Go through the pictures. So from there you really need to dig deeper to give a accurate, you know, price point for a home.

Speaker 2: (10:47)
So it can vary from agent to agent. And typically one of the agents is wrong. You know there, if there is a big difference in a price suggestion, it's because someone pulled comps inaccurately. So make sure that you are getting the guidance that you should be receiving. And just because an agent gives you a Barry lofty number, the most appealing number doesn't mean that that's correct. Does not mean that that agent pulled comparables correct. So make sure that they are showing you why they came up with that number. They're not just kind of, you know, just tweaking the numbers to make it look most attractive to you.

Speaker 1: (11:23)
You've been listening to the savvy real tour podcast. I'm Walter store Holt alongside Angie Cole. She's the owner and broker in charge of Aiko Realty here in the triangle. And if you have questions for Angie, we invite you to go online to a Cole listen to past podcast episodes on the website, read the blog and all the great information, including the option to find a home right there on the website. That's a Cole and you can also call Angie with your questions. (919) 578-3128 

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