Estimated reading time: 5 minutes
Before making an offer, you should have as much information as possible about the property and its surrounding area. To avoid negative surprises down the road, you should be aware of and gather these critical pieces of information beforehand so you will be properly informed – ahead of time – about the property you hope to purchase.
1. KNOW THE PROPERTY
A clear understanding of the property’s size, layout, age, and condition is all-important. Even though the square footage and room sizes may be listed in the MLS, you should always verify those numbers yourself.
The condition of the property should also be determined with the help of a reputable home inspector. An inspection will typically take place after an accepted offer, but knowing which items you want the inspector to pay particular attention to will help. An inspection clause will allow you to back out of the transaction if the inspection report is not satisfactory or if the seller does not wish to make repairs flagged by the inspector (unless the property is “as is”). There are many options to consider, and this article will explain more about property inspections.
2. READ THE DISCLOSURES
Unless a property is in foreclosure or is already bank-owned (REO), there should be a Seller’s Property Disclosure that your agent can provide. Review this document carefully, making note of any repairs that have been made or defects that have been discovered.
3. REVIEW ALL APPLICABLE DOCUMENTS
If the property is in a homeowner’s association (HOA), the buyer should obtain information about the HOA dues, rules, and regulations. All of that and more are usually found in the HOA bylaws, a document that the seller’s agent should have. The HOA document may also include information about landscaping requirements, parking restrictions, and community amenities such as a pool or tennis court. In addition, check for any upcoming or ongoing capital improvement projects. Like an inspection, a review of HOA documents typically occurs after an accepted offer and your offer should include a clause to back out of the transaction if the review of those documents yields an unsatisfactory result for you. Your agent can provide the necessary and appropriate wording for such a clause covering the HOA documents.
4. REVIEW THE TAXES
Always get a copy of the property’s current tax bill and history, including its assessed value, any new assessments coming, and any recent changes in tax rates. If you’re applying for a mortgage, the monthly payment to the lender usually includes the monthly property tax amount for loans in which the down payment is less than 20% of the purchase price. Keep in mind that taxes may vary based on whether or not it was considered a “homestead” property for the current owners.
5. STAY SAFE
Research crime statistics for the area to ensure that the neighborhood is safe and secure. Because of the Fair Housing Act, your real estate agent cannot help you much in this regard since the agent’s actions may be construed unfairly. A good article to learn more about researching crime in a particular neighborhood can be found on Realtor.com’s website.
6. LEARN ABOUT THE SCHOOLS
If you have school-age children, it is very important to research the local schools’ quality and proximity to the property. That includes the schools themselves, bus routes, extracurricular activities, and awards. Some resources to start with include:
7. DETERMINE DISTANCES FOR EVERYDAY ACTIVITIES
Be sure to note the commuting distance and transportation options to and from the property for work, school, and shopping. Check the time it takes to travel that distance at specific times of the day by using Google Maps to get a more accurate estimate of drive times. You may be surprised to learn that some shorter distances actually take a considerable amount of travel time during rush hour. Make sure you understand how much time you may sit in traffic on a daily or weekly basis before making that offer.
8. SCOUT THE NEIGHBORHOOD
Neighborhood amenities such as parks, restaurants, shopping centers, and other recreational facilities can make a big difference in your decision. A simple Google search can do wonders for finding local hotspots and events, and Google Maps can show you distance from hospitals and clinics, shopping, and more.
You can also talk to the neighbors! Ask them what they like (or don’t like) about the neighborhood.
9. CHECK THE BANDWIDTH
Check to see what kind of reception you get with your cell phone service, and research what internet service options are available.
10. ESTIMATE THE UTILITIES
Ask for a copy of a year’s worth of the monthly utility bills for the property, including electricity, natural gas/propane, water, sewer, and garbage pickup. Depending on the locale, the water and sewer bills are covered separately in the property tax bill. This information will help you understand the additional costs of owning that property and what to budget for during peak usage months.
11. ESTIMATE REMODELING COSTS
Have an idea of what changes you want or need to make along with their costs and timing to the property. This includes items like upgraded landscaping, a new deck, siding, new windows, and HVAC repair, as well as decorating costs like paint, new flooring, or window coverings. The following articles may help you decide if a fixer-upper is right for you, along with some considerations for costs and financing.
- How to Choose the Best Contractor
- 23 Energy Saving Solutions for Your Home
- How to Choose the Best Light Fixture for Each Room in the House
- Can You Turn an Ugly House into a Beautiful Home?
- 11 Ways to Increase the Value of Your Home
By gathering as much information as possible about a property and its surroundings, you can make an informed decision and feel confident in your offer. My responsibility is to assist you in analyzing this information so we can craft the best offer for you.