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Sure. The buyer's agent I used told us that houses in one neighborhood we were interested in had a rash of problems from compressible soils, and that the foundations needed a hard look by an expert. He warned us about accessibility and drivability issues on some back roads and steep driveways up around Chipita Falls. He had good detail on the seller and the seller's note(s) for each house we looked at, and prevented us wasting a lot of time on houses that had sellers deeply indebted with second mortgages and/or underwater refis from banks that had a reputation of stalling for months on short sale offers. His assessments of realistic prices was based on current knowledge of trends (not just comps) in specific markets. And when we bought our house (a bank-owned foreclosure) his experience working with REOs enabled us to make an offer presented to them with our clear intent to look elsewhere if we didn't get expeditious responses from them.
The problems from compressible soils - that's a good example of a useful tip from an agent.
But, beyond that I'm not so sure -it's easy to find out if a house is up for short sale in most cases. And, the ways that banks handle short sales is so erratic that I'm doubtful that an agent could really say what to expect on a given short sale offer - at best a bank will behave the same way for a month or two but processing of short sales is always subject to so many internal things at the lender.
I am also skeptical about his assessments of realistic prices - how is it possible to really know this information? Comps are comps, but houses are rarely perfectly comparable. Prices are all over the place, but it seems unlikely that anyone could accurately estimate the motivation of the seller, their individual circumstances, etc. enough to really do a better job estimating 'realistic' prices. My uncle's house has been for sale for 11 months - they are unmotivated so it doesn't matter what someone thinks a realistic price is for that particular house.
As for your last example, I'm pretty unimpressed with that one! Making a short offer or an REO offer isn't the same as an ordinary offer. You need to sort of 'perfect' the offers accordingly. In a short sale, you want to unencumber the offer as much as possible, ideally taking out everything from inspection clauses to financing, etc so that they offer is as 'sure' as possible for the bank. They want an easy deal. REO's are the same - you want to have a nice short acceptance period since you can assume that the bank doesn't want to go back and forth, etc. That information is available to anyone who does nominal research on how to buy shorts/REO's.
Don't get me wrong, the local knowledge (like the soil concerns) are valuable. But I am just so skeptical about agents, most of whom don't add value (as you suggested).
Last edited by OneMoreMove; 05-24-2010 at 04:06 PM..
Reason: spelling :)
Most buyers look to the internet for property listings. A Realtor can prove to be invaluable, especially if this is a new area to you.
Most buyers do not wish to deal with a seller by themselves. Especially when there is so much inventory.
Since most buyers work with Realtors, doesn't it make sense to also have that advantage?
Certainly it does, but that advantage isn't always a good advantage and is never free. So many agents just herd the buyer through the deal without really advocating for them, and 3% can really add up.
It's true that many buyers don't want to deal with sellers. But, a good attorney can jump into the mix and almost always do it less expensively - you just don't get the 'knowledge'.
It would be the buyer's or seller's job to interview then hire the right advocate.
3% ain't nothing if something goes wrong.
I have no idea if a local real estate attorney would in fact be cheaper in the long run. Since you don't know upfront how many hours a transaction will take.
(They are rarely straightforward.)
To the OP - I would hire a local professional. You can have more than one Buyer's Agent/Broker - they would put in the contract that they represent you for insert this specific area.
That's true, but would a savvy buyer with an attorney take an increased risk of things going wrong?
In Denver, real estate attorneys seem to go for around $150-$175 (at least the ones I spoke to, hired). Writing a few offers, counters, various notices is pretty quick for them. I'm told that the average residential real estate transaction without too many surprises usually runs $800-$1600, which sounds about right. I have not seen one go over 10 hours, personally, and that includes a pretty complicated short sale with 2 lenders and a bunch of misc. contingencies and exceptions.
But, beyond that I'm not so sure -it's easy to find out if a house is up for short sale in most cases. And, the ways that banks handle short sales is so erratic that I'm doubtful that an agent could really say what to expect on a given short sale offer - at best a bank will behave the same way for a month or two but processing of short sales is always subject to so many internal things at the lender.
Some note holders are worse than others, and there isn't, AFAIK, any good means of researching that. The dealings we had with the bank we bought from went just as the agent suggested...because he'd dealt with the same people before.
Quote:
Originally Posted by OneMoreMove
I am also skeptical about his assessments of realistic prices - how is it possible to really know this information? Comps are comps, but houses are rarely perfectly comparable. Prices are all over the place, but it seems unlikely that anyone could accurately estimate the motivation of the seller, their individual circumstances, etc. enough to really do a better job estimating 'realistic' prices. My uncle's house has been for sale for 11 months - they are unmotivated so it doesn't matter what someone thinks a realistic price is for that particular house.
You misunderstand me. It isn't an issue of what price is realistic in the eyes of a particular seller. It is possible to gauge a realistic price for a certain kind of property in a certain area...realistic meaning that there are one or more sellers willing to go to that price level.
Quote:
Originally Posted by OneMoreMove
As for your last example, I'm pretty unimpressed with that one! Making a short offer or an REO offer isn't the same as an ordinary offer. You need to sort of 'perfect' the offers accordingly. In a short sale, you want to unencumber the offer as much as possible, ideally taking out everything from inspection clauses to financing, etc so that they offer is as 'sure' as possible for the bank. They want an easy deal. REO's are the same - you want to have a nice short acceptance period since you can assume that the bank doesn't want to go back and forth, etc. That information is available to anyone who does nominal research on how to buy shorts/REO's.
Making a successful offer on a REO and especially on a short is not cut and dry at all. In our case we made a cash offer but did not forego inspection, title search etc. We knew, in large part from the agent's background info, how long the property had sat, how much the bank had in the house from the first mortgage based on the foreclosure sale, and a good idea of that same bank's other properties in the area and how few were moving. It's simply not true that all banks will give away the farm to close an "easy" deal...assessing their motivation and knowing their history is important. And you are dead wrong that REOs are all the same...different banks, different markets, different timing etc all matters. A simple piece of info that you might not think of like when the bank's fiscal year ends is an important data point is assessing their motivation.
Quote:
Originally Posted by OneMoreMove
Don't get me wrong, the local knowledge (like the soil concerns) are valuable. But I am just so skeptical about agents, most of whom don't add value (as you suggested).
I think most agents won't add as much value as the guy we used. Finding one that is both knowledgeable and has some integrity (i.e. isn't trying to keep the price up to drive a bigger commission check) is the hard part for a buyer. I don't have a recipe for success there other than an old-fashioned ability to size up a person.
Thx all. I relent; I will probably use a realtor, for each area, for the depth of knowledge of area reason. Just more time consuming as I have to find someone I jell with in each area. Because I am considering different typed (mtn to urban) areas, but all relatively in the same region, I just thought one realtor may work there. It is a big "region" tho; looks smaller on maps from my view in PA
If I decide to not buy this summer tho, but wait until I am actually "done" where I am (12 mos) I am still going to continue to look into buying/selling RE the hard way, FSBO, as the internet has changed everything in regards to finding info/facts ourselves. I have learned how to look at tax records, I read local CO papers, and this forum, sites like zillow.com can show lots about comps too and sales/listing history. Also, I agree with OneMoreMove that the lawyer fees are very reasonable. And the home inspection is not all that it is cracked up to be; the owner still has to dig themselves. I have heard that the home inspections that most of us trusting folks (who use a realtor and trust the process) provide not nearly as much info as we think it does...the inspector only has to inspect/report on what can be seen. Am I right about that?
BobfromdownSouth, can you send me the name of the relitter you used? Sounds like a good one--altho I am so far not looking Co Sprgs. If I go for a short sale, he/she sounds good. Also, good tip on checking the banks fiscal year and other motivations.
Thx all. I relent; I will probably use a realtor, for each area, for the depth of knowledge of area reason. Just more time consuming as I have to find someone I jell with in each area. Because I am considering different typed (mtn to urban) areas, but all relatively in the same region, I just thought one realtor may work there. It is a big "region" tho; looks smaller on maps from my view in PA
If I decide to not buy this summer tho, but wait until I am actually "done" where I am (12 mos) I am still going to continue to look into buying/selling RE the hard way, FSBO, as the internet has changed everything in regards to finding info/facts ourselves. I have learned how to look at tax records, I read local CO papers, and this forum, sites like zillow.com can show lots about comps too and sales/listing history. Also, I agree with OneMoreMove that the lawyer fees are very reasonable. And the home inspection is not all that it is cracked up to be; the owner still has to dig themselves. I have heard that the home inspections that most of us trusting folks (who use a realtor and trust the process) provide not nearly as much info as we think it does...the inspector only has to inspect/report on what can be seen. Am I right about that?
BobfromdownSouth, can you send me the name of the relitter you used? Sounds like a good one--altho I am so far not looking Co Sprgs. If I go for a short sale, he/she sounds good. Also, good tip on checking the banks fiscal year and other motivations.
I think you'll find that if you are motivated, you can do a lot on your own. You can spend tons of time finding that one Realtor who truly has that 'inside knowledge' of the area and perhaps that knowledge will help you out. Or you can research on your own and probably find out everything yourself.
You can do short sales, you can do so much on your own if you want to.
Inspections is one of those categories that is a bit different. A home inspection is limited in scope, but there lots of inspectors who do a great job and will find things that you might not unless you really have some experience. They only inspect what can be seen, sure, but my inspector has pretty good eyes and knows just were to look.
He's a truly fantastic inspector and I can refer you if you want - he's out of Litleton. The guy we bought our last house from said that he's already been through 2 inspections and fix-ups - his own when he bought and one from a buyer who fell through. Our inspector added like 40 items to the list, total value of about 5k. Money well spend, imo!
A couple things I've found useful when looking for a house:
Google maps has a dropdown menu that lets you look for houses for sale. Its a pretty neat tool.
Over the years I've noticed that RE agents try really hard to keep buyers and sellers separated, but that isn't in your interest as a buyer. You can gain a lot of insight into the person you're buying from if you ask for them to be present to answer any questions you might have when you look at the house. Are they driving too expensive of a car? If so, they're probably hurting for money. Do they take care of their car? If not, they probably treated the house the same way. If they did any home improvements, do they look like the type of people who would know what they're doing? Do they seem like the type of people who put more effort into looks than doing the job right?
Get the owners to brag about all the good stuff, and then quiz them about what still needs done. It doesn't hurt to ask if they've saved owners manuals for sprinkler controllers, furnaces, etc.
Being able to talk to the sellers helps to facilitate communication too. Instead of having to wait days for your agent to talk to their agent so he can talk to them and then call your agent who eventually calls you, you can just ask questions directly.
When looking for a RE agent, look at their picture and skip over the pretty ones. If an agent is old and ugly and still working, there's a pretty good chance that they'll do a better job than a 25 year old beauty queen.
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