HOW NOT TO PAY TOO MUCH FOR A HOME
Up until recently, there was little or no way for consumers to discover if they were paying too little, or too much for a home. Frequently real estate agents puff up prices to get a listing, or they list over-priced properties as the only way the seller will retain their services.
We think your buying real estate now, will pay dividends down the road. In addition, for investors, who want cash flow, we think rental properties offer enormous upside, as long as the investor’s do their own research, and the rent the property can get covers operating costs like debt service, taxes, insurance, maintenance, upkeep, and the rental property will throw off at least 7% in cash flow.
There are now companies that will give you a reliable report that will help give you a snap shot of what homes are selling for in your proposed new neighborhood. At the same time it is relatively easy for an investor to size up a neighborhood’s rental potential, By looking at the rental comparable’s. By doing this a potential homeowner, or real estate investor should be able to get a sense of what homes are selling for, or renting for in a specific neighborhood. In the same light, a potential seller could utilize this service to determine pricing for his/her house, in order to sell at a realistic price. By doing this, a seller can avoid listing a property for less than its worth, and the seller can avoid putting his/her/their home on the market at a price that is unrealistic (too high for the market). In the event the homeowner is currently upside down on their home, we strongly recommend renting the property, provided the rent covers the existing mortgage payment, taxes, and insurance.
For those of you about to purchase a home, or for those of you about to sell your home, make every effort educate yourself on comparable home sales in the neighborhood. Don’t pay too much, or get too little for your home. We highly recommend visiting www.zillow.com