Talk to the bank
The first step before you even begin to consider buying real estate is to talk to the bank and work out the maximum amount you are able to borrow. Consider getting this loan pre-approved to show realtors and sellers that you are serious about making an offer.
Stick to your budget
After talking to the bank, you must work out how much you would be willing to spend on a house. Ensure that you don’t exceed the budget and keep in mind that you will have additional expenses to consider such as the moving process or interest on the loan.
Examine additional features
Does the house have any additional features that could save you time or money in the future? For example, you may be able to offer more on a house with solar panels that will reduce electricity bills in the long run.
Work out any conditions attached to your offer
Ultimately you are in charge of the conditions attached to your offer, such as if you will require an extended settlement period, but try to keep conditions to a minimum so the offer remains simple and appealing to the seller.
Take a friend
It is worthwhile having an unbiased opinion to prevent you from getting swept up with the excitement of purchasing real estate well over your budget or without critical features you require.
Work out how much you’ll need to spend on renovations
It is dangerous to get stuck in the trap of looking at the ‘potential’ of a house and making an offer without seriously considering the cost of the work that will need to be done. Even if the house is a fraction of your budget, is it going to remain under that budget after all required alterations are made?
Determine the worth of the property
How long has it been on the market? How much have similar houses in the area gone for? Does it meet all requirements?
Be cautious when it comes to negotiation
If there have been other offers for the house and you’ve decided to test your luck by making a low-ball offer, most likely your chance at the house will be gone. It is important to find a price that you would be happy to pay without risking the owners rejecting the offer.
Research before the house opening
Real estate in the right market can get multiple offers after the first opening so it is crucial to be prepared and ready to make that offer immediately.
Be open with the realtor
Although the realtor is out to get the best offer, they would rather sell the house at a lower price than have it on the market for months. They can inform you more than any website what the buyer will accept and whether the offer is worth your time.