Buying A House Is Just Like Learning A New Sport
By Kurt Real Estate Nov 23, 2019
The most important document in all of real estate is the Residential Purchase Agreement, or RPA. The RPA defines between the buyer and seller under what terms, conditions, and in what timeframe the property will transfer ownership.
If buying or selling a house is a sport, then the RPA determines the rules. And if somebody breaks the rules, there are penalties; sometimes very expensive penalties.
If you were learning how to play a new sport you wouldn’t jump in without first learning the rules of the game, would you? The same concept holds true when buying a home.
Let’s take poker as an example (we can argue about whether poker is a real sport later). You would probably want to learn as much as you could about the game before you sit down and start playing with your own money in Vegas. Some things you would probably want to learn are:
What hands are better than others
How to make a weak hand appear strong and vice versa
How to protect yourself from being manipulated or taken advantage of
Without knowing the rules and basic strategy of the game, you’re putting your money at risk. It’s the exact same concept in real estate.
If that sounds a little daunting, don’t be alarmed. No one is expecting you to have expert-level knowledge of this stuff. But here’s a few things you should at least be aware of:
Basic strategies for writing a strong offer (Hint: this has nothing to do with price)
Conditions under which either party can cancel the agreement without penalty
How to limit or eliminate your exposure if you as a buyer decide to cancel
The different contingencies and timeframes for removal
How to get your offer accepted even if your price isn’t the highest
How to make sure you’re treated fairly in a real estate transaction
This is one of the reasons why people hire a real estate agent to assist them in the purchase of their home.
With sites like Realtor.com, Trulia, and Zillow that make listings available to the general public, the role of most real estate agents has shifted from helping their buyers find a property to becoming an advisor to help them through the home buying process.
Just like a listing agent should have strategies to sell your home at the highest possible price, so should a buyer’s agent have an approach to not only get your offer accepted, but also show you how to pay the lowest possible price.
So after you learn the rules of the game, you would probably want to spend a little time practicing, right? Maybe you sit down with a friend or two and practice for a few hours.
Again, it’s the same concept when buying a home. But when I say “practice” in this context, what I really mean is “practice writing an offer”.
With every one of our clients, we sit down and walk them through the in’s and out’s of an offer, while giving them the chance to fill out a blank offer by hand for a few reasons:
It creates peace of mind knowing what you’re going to be signing. The last thing you’ll want to do is sign a 10-page legal document that you’re just seeing for the first time. And frankly, anyone who doesn’t take the time to walk you through that is doing you a disservice.
You get to see for yourself what the best strategies are to writing an offer.
It removes the “intimidation” factor. Once you’ve practiced writing an offer, the act of writing a real one won’t seem so scary.
Doing so will calm your nerves. When you find the house you want to buy, you will be experiencing a flurry of emotions. And again, no one wants to see a stack of legal documents for the first time in that moment.
Just like an athlete before game day who practices their plays an reviews their strategies, so do you as a buyer. Buying a house is just like a competition, and you need to be ready when it’s game time.
By taking a few simple steps, you can position yourself to be more competitive and knowledgable than about 90% of all other home buyers out there, which will ultimately allow you to buy the home of your choice at the best possible price.
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