DOES A REALTOR COST ME MONEY?

When buying a home in Colorado, you are typically NOT responsible for paying your buyer's agent for the services provided. It is FREE representation! The buyer’s agent is compensated by the seller when title is transferred at closing. If you are a seller using an agent, the total commission fee (split between the buyer's agent and your listing agent) is typically around 6%.

HOW can A REALTOR HELP ME?

If you are a buyer, there is a lot of upside and very little downside to seeking the knowledge and expertise of a professionally licensed real estate agent. Be sure to do your due diligence and find an agent that is on top of current market trends and understands what it takes to get you under contract and close on a home.

A seller can find immense value in a real estate professional as well. The experience, skill set, and tools of a seasoned real estate agent can net the seller MORE than a home for sale by owner (FSBO) even after a 5.6-6% commission fee. How? Consider this example: A FSBO seller with little experience in real estate sells their home for $350,000 without having to pay a commission fee. An experienced agent uses their networking and skills to sell the same house for $400,000. Even after a 6% ($24,000) commission fee (3% each to the listing and buyers agents), the real estate professional nets the seller more at $376,000 than the FSBO at $350,000!

IS OWNING SMARTER THAN RENTING?

Potential first-time home buyers have been considering this question forever! While some agents will insist there is a correct answer to this question, I approach it a bit differently. There are pro’s and con’s to both renting and owning. The answer to whether or not owning is smarter than renting is dependent upon what the individual finds more advantageous and attractive to their lifestyle.

While renting has lower financial risk (not having to deal with replacing expensive appliances when they break, for example), the advantage to owning a property is that you own an appreciating asset. Your monthly payment is an investment in your own future, as opposed to paying rent to someone else. You can also invest in your property through improvements and if you buy wisely, the property will increase in value faster than the rate of inflation. Furthermore, unlike stocks and bonds, you get to live in and enjoy your appreciating asset! A renter does have more freedom to move and follow job offers, while buying a home doesn’t offer as much flexibility and usually only makes sense if you plan to be there for at least 3 years. There are many different advantages to owning or renting.

The answer to whether or not one is smarter than the other lies in what value you place in those advantages. Want to have freedom and mobility with less risk? Maybe renting is for you. Want to own an asset that will gain value over your lifetime? Maybe buying a home is something you should pursue. No agent can determine what is best for YOU!

DO I NEED to put 20% DOWN TO BUY A HOME?

In short, no you do NOT! This is a common misconception in today’s market. A few factors play into how much money you need to bring to the table in order to buy a home, but a lot of loan products only require 3-5% down, and some even less. I suggest you speak with a reputable mortgage lender in Colorado to make sure you understand all of your mortgage options. If you would like a list of reputable lenders I work with, I would be more than happy to share it with you! Remember to always do your due diligence and find the right lender that works best for you.

CAN I GET A MORTGAGE?

This question is best discussed with a lender who understands the ever-changing financial requirements of home loans. There are many different types of loan products that have different credit, income, and down payment requirements. The most common types of loans include conventional (typically higher credit score, larger down-payment, lower interest rate) FHA (federally backed home loan that has lower credit and down payment requirements but typically higher interest rates) and VA (veteran loan requiring 0% down). Each have their strengths and weaknesses so be sure to assess each loan product you qualify for to determine which one is right for you!

should I plan on Making a Low-Ball Offer?

As I discussed in more detail on pg. 12 of the buyers guide, Colorado is a seller's housing market where sellers are steeply advantaged. In such a competitive market for buyers, you are essentially wasting your time with lowball offers. It is not uncommon to have 10-15+ offers on a home, the majority well above asking price. There is almost no space in this market for "deals." Homes today are generally priced competitively for the type of market they are currently in. Have your real estate broker pull all of the comparable current property sales to make sure.

should i hire an inspector

Yes, it is a good idea to hire an inspector to evaluate the home you are going to purchase. The inspector will check all the components of your new home and familiarize you with the property. Health and safety issues that are identified during inspection can be used to negotiate on behalf of the buyer.

HAVE A MORE SPECIFIC QUESTION?

If you have a question that I did not answer here or would like to have a no-commitment conversation about buying or selling a home, please reach out to me below and I will email you back promptly!

REMEMBER: If you are looking to buy a home, my services as a real estate agent are completely FREE to you as a buyer! If you are looking to sell a home, I provide an excellent value by consistently netting sellers more overall than a FSBO listing paying out a buyers agent commission. You want someone who protects YOUR interests.