Below are the last steps(4 and 5) on how to purchase a home in Orange County.
Negotiate the Offer
Buyers sometimes make the mistake of comparing the sales price of a home to other homes they have seen. It’s a mistake to compare sales prices among homes for sale. That’s because sellers can ask any price they want. It doesn’t mean the home will sell at that price.
- An agent can provide comparable sales and examine the pending sales. Comparable sales are similar type homes in the same condition and location that have sold within the past 3 months
- Pending sales will become the comparable sales by the time your home closes.
You may need to pay over list price in a seller’s market(Orange County is experiencing a very aggressive Sellers’ market) , many buyer are bidding on the same property. This will bring bidding wars and bring in offers above asking and even above market prices.
- Your agent can give you a reasonable price range and help to manage your expectations.
- A good buyer’s agent knows there is always more to an offer than its price, but price is paramount.
Do a Home Inspection
In CA a home inspection is a contract contingency.
- A contract contingency means a buyer has the right to cancel the contract.
- You might not want to be locked in to buying a home that has a faulty foundation, for example
- This can be waived but is unadvisable. REOs and Short Sales are sold “AS IS” meaning you can still perform an inspection and back out of the contract, but the Bank will not do the repairs
- Contingencies will be released once both parties have been satisfied with the offer(for the seller) and the home condition(for the buyer)
- When contengencies are released you have a mutually and fiscal measures can be taken
Sellers are generally not required to make repairs if problems are discovered during a home inspection. A home inspection is for the buyer’s edification. However, sometimes when a buyer gives a Request for Repair to the seller, rather than blow the deal, the seller will often agree to make a repair.
In Orange County the sellers are refusing almost all request because they know the can most likely get a even higher price if the buyer backs out. The reason for this is Orange County has seen a 30% year over year appreciation in homes since June of 2012. That is an average of nearly 3% a month and possibly more in the most recent months. The largest wave of appreciation has happened since the beginning of the year.
This is just the simplified version of purchasing a home and I hope that this can give you potential future holders of the American Dream a plan of action. I am always available so fell free to call or email me.