5 Errors Home Shoppers Should Avoid!!!

Real estate professionals say they keep seeing buyers make the same mistakes over and over again in a home purchase. Among some of the common errors they see:

  • Unrealistic time tables: With a regular sale, “assuming you’re preapproved and it’s straightforward, you can probably do it in 30 days, but 45 is more common,” says Ron Phipps, immediate past president of the National Association of REALTORS®. But he advises home buyers to prepare for 45 to 60 days. And if it’s a foreclosure property, they may encounter lien and title issues that could cause delays stretching that to 60 to 75 days, even up to 90 days. And for short sales, that timeframe will greatly depend on whether the lenders have already agreed to it and a preset price, but it could take anywhere from 45 days to even up to nine months, Phipps says.

 

  • Ignorance with financing: Home buyers should learn more about the mortgage process, learn the terminology, and know what questions to ask in shopping around for the best mortgage rate. For example, Carolyn Warren, author of “Homebuyers Beware,” cautions buyers to never tell a lender, “This is my first time, and I don’t know how it all works — and I need you to guide me through the process,” she says. “It’s like putting a sign on your forehead that says, ‘Charge me more.’”

 

  •  “Trash talking” when negotiating: If the home is painted pink and the buyer insists it needs to be repainted, he could risk jeopardizing negotiations. Instead, Phipps suggests that when making an offer, buyers should stress what they like about the home. “Don’t make it adversarial,” he says. A price reduction should be talked about in terms of what the home is worth to that buyer, he says.

 

  • Getting in over their heads: Buyers may be tempted to stretch their budget in order to get the house of their dreams. Phipps suggests buyers don’t stretch themselves so thin that they miss out on having a reserve fund in case they need to make any unexpected repairs once they move in. “In most homeownership situations, there are going to be some unforeseen circumstances,” Phipps says. “So you want to make sure you have some funds behind you.”

 

  • No Reserve Fund:  After finally finding that “dream home,” what buyer isn’t tempted to stretch as far as possible — and drain all available savings — just to make the numbers work? It’s one of the big homebuyer mistakes, Phipps says.Often, buyers fall in love with a property, and they try to rationalize the decision, he says. “You need to be disciplined about it.”Too often, buyers set a price range and then fall in love with something that costs more. So they figure they’ll borrow the difference, Phipps says.But you need a reserve fund — something you hold back to address unexpected problems, like the refrigerator that quits in mid-July, or the “like-new” water heater that dies the day after you move in. Or the realization — after seeing the neighbors sunbathing once too often — that you need a privacy fence, pronto.”In most homeownership situations, there are going to be some unforeseen circumstances,” Phipps says. “So you want to make sure you have some funds behind you.”

Article from http://realestate.glozal.com/profiles/blogs/5-errors-home-shoppers-should-avoid

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Top 10 Cities with Highest Price Drops.

California cities have seen their home values drop by the largest percentage in the last five years, with some metro areas posting losses of up to 67 percent in that time period. California cities occupied six of the top 10 metro areas with the largest drops, according to a recent Zillow study based on its home-value estimates and Zillow Home Value Index. 

Overall, “there will be many ups and downs in home values before this is over, and we continue to expect a true bottom in 2012, at the earliest,” says Stan Humphries, Zillow’s chief economist. “There are still hazards in the form of a full foreclosure pipeline, high negative equity, and fluctuations in demand.”

The following are seven cities that have seen home values drop the most since the housing boom, according to Zillow: 

1. Merced, Calif.

July 2011 Zillow Home Value Index: $106,514

Zillow Home Value Index 5 Years ago: $328,813

Value difference (by percent): -67.6%

 

2. Modesto, Calif.

July 2011 ZHVI: $128,777

ZHVI 5 Years Ago: $352,599

Value difference: -63.5%

 

3. Stockton, Calif.

July 2011 ZHVI: $150,061

ZHVI 5 Years Ago: $404,036

Value difference: -62.9%

 

4. Las Vegas

July 2011 ZHVI: $117,084

ZHVI 5 Years Ago: $303,656

Value difference: -61.4%

 

5. Vallejo, Calif.

July 2011 ZHVI: $190,521

ZHVI 5 Years Ago: $468,071

Value difference: -59.3%

 

6. Salinas, Calif.

July 2011 ZHVI: $282,289

ZHVI 5 Years Ago: $664,404

Value difference: -57.5%

 

7. Daytona Beach, Fla.

July 2011 ZHVI: $95,193

ZHVI 5 Years Ago: $220,436

Value difference: -56.8%

 

8. Bakersfield, CA

July 2011 ZHVI: $120,113

ZHVI 5 Years Ago: $273,854

Value difference: -56.1%

 

9. Fort Myers, FL

July 2011 ZHVI: $125,575

ZHVI 5 Years Ago: $289,671

Value difference: -56 %

 

10. Phoenix, AZ

July 2011 ZHVI: $122,880

ZHVI 5 Years Ago: $276,888

Value difference: -55.6 %

 

Complete article from http://realestate.glozal.com/profiles/blogs/markets-where-home-prices?xg_source=msg_mes_network

Picture curtosey of http://www.nevadacounty.com/2011/03/home-prices-drop-february/