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Recommended Steps in Home Buying Process

Recommended Steps - The Home Buying Process in MA

The process for buying real estate in Massachusetts should be approached in the following manner:

  • Determine your objectives, wants and needs (locations, budget, use of property, timing, etc.)
  • Determine the kind of professional help you think you need to find and buy your property (buyer agent or seller agent, attorney, appraiser, home inspector, lender, etc.). Your knowledge of the area and property values are important factors in determining the help required.
  • Ideally, interview at least 3 real estate professionals and compare them for expertise, market knowledge, and role that you desire (buyer agent, seller agent, access to full set of properties on the market, personality fit, etc.)
  • Select a real estate professional.
  • Get in writing your relationship with the professional agent you choose.
  • Make sure you can obtain any financing you will require. Know your credit score. (Determine your qualifications, your comfort factor on monthly payments, rates, source for deposit money, etc.) Do this before you find your home to increase your bargaining strength with your lender and also to reduce time-pressure and stress on you.
  • Establish a plan for the property search in your area of interest. See homes that are in the Multiple Listing Service (MLS), For Sale By Owner (FSBO), bank owned, distressed property, neighborhood searches, auctions, open listings, and more.
  • If you are working with a real estate agent, make sure you know whose side the agent is on. Know the office policies these agents must practice under. Dedicated or True Buyer's Agents never represent sellers and buyers in the same transaction within their office. By holding to this high standard, all agents in these offices can work toward the best price and terms for buyers. They can focus on getting the most house for the money.
  • If you find a property that you like, you need to do research such as: finding out as much as you can about the property, the community, the septic system, zoning, setbacks, water supply, etc. MABA buyer's agents do this work regularly and will give you lots of tips. Example: Waterfront/water view buyers: If you are going to pay a premium for a view or being near a nice beach, make sure these attributes are not at risk (erosion, vegetation growth or a new house blocking the view, and more.)
  • Walk the neighborhood and talk to residents on the street. You will be surprised at the useful information you will pick up. If you are shy, bring a gregarious friend along!
  • Prior to making any offer, make sure you are familiar with other houses on the market that meet your needs and your budget objectives. Make sure you are also aware of the recent sales in the community and that you compare the house you want to purchase with these comparable sales. Your dedicated buyer's agent can give you this information without running into a conflict of interest with sellers represented in their office.
  • Most importantly, decide if this is the best house for you in this price range. If the house does not suit you, what's the benefit of getting a good deal on it? Your buyer's agent will do a market study for you that will give an estimate of the property's true market value. Asking prices vary wildly from final sale prices. A buyer's agent gives you the facts you need to move forward with confidence. Use this information to decide how much to offer.
  • If you decide to move ahead, prepare a written offer to purchase that includes price, terms, conditions, and contingencies - all of which are in your best interest. (In Massachusetts, real estate contracts need to be in writing to be legally binding). The typical binder deposit accompanying an offer is $500 to $1000.
  • Prepare a negotiating strategy. (Identify the reasons why the property owner should accept your offer. Include information about yourself and the fairness of your offered price and terms.) A professional buyer's agent has studied ways to negotiate for the best price and terms for buyers. Listen to their advice, then make your decisions.
  • Make the offer presentation. Your agent will do so following your chosen negotiating strategy.
  • Once an offer is accepted, your buyer's agent will make sure both parties sign off on the agreement.
  • Hire a home inspector to evaluate the house to identify any defects requiring corrective action. A nationally certified inspector is recommended. In Massachusetts home inspectors are licensed by the Commonwealth. Attend the inspection and from the report identify any problems that you will ask the seller to correct prior to the closing date. Your buyer's agent can help you "digest" your inspection report. Then you will have a clearer sense of what work awaits you after closing, and whether this is still the house you want. Your agent will recommend a course for a re-negotiation if it is necessary after your inspection.
  • Once buyer and seller agree on the inspection items, a purchase and sale agreement is signed by both parties. Legal assistance is recommended for all contracts. Your buyer agents will coordinate among the professionals on your team - your lawyer, your lender, your broker.
  • From this point on, there are things to do to help your move-in go smoothly. Your professional buyer agent can help you choose your home insurer, plan any repair work you will do after closing, switch your utilities, and any other aspect of your move.
 
 
 

Latest from the Blog

  • Massachusetts Pending Home Sales and Median Price Up Again in June

    The Massachusetts Association of Realtors® (MAR) reported today that single-family pending home sales were up over nine percent in June from last year. Pending condominium sales were also up more than 12 percent. The median price for both single-family homes and condos saw a hike, with the single-family median price rising over the $400,000 mark. Realtors® confidence both in the market and in home prices dipped slightly in June. This month’s “Hot Topic” question finds that the majority of Realtors® surveyed have had at least one transaction that was an all-cash deal (i.e. no mortgage involved) since the beginning of the year.

    June Pending Sales: 

    Single Family June 2017 June2016 % Change
    Sales 6,723 6,128 9.7%
    Median Price $410,000 $380,000 7.9%
    • Pending sales have been up 51 of the last 52 months 
    Condominium June2017 June2016 % Change
    Sales 2,596 2,307 12.5%
    Median Price $370,000 $349,900 2.9%
    • Pending sales have been up or flat 20 of the last 22 months 

    “The increase in homes put under agreement this month may be a positive sign for a spring market that has suffered plummeting inventory,” said 2017 MAR President Paul Yorkis, president of Patriot Real Estate in Medway. “However, median prices have continued to rise, which can push some buyers out of the market.”

     
    Realtor® Market and Price Confidence Indexes: 

    Confidence Index June2017 June2016 %Change
    Market 80.73 80.97 -0.29%
    Price 71.79 73.87 -2.82%
    • The Realtor® Market Confidence Index went down for the first time in 27 months
    • The Realtor® Price Confidence Index went down for the first time in six months
    • Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition  

    “The Realtor® Market Confidence Index has dipped year-over-year for the first time in over two years, indicating that Realtors® are growing concerned about some of their buyers being able to succeed in this market,” said Yorkis. “However, both indexes reveal that ultimately Realtors® remain positive. We just need to see more inventory to keep up with the demand.”

    With home inventory being as tight as it is, you want to give yourself every advantage if you are thinking of buying a home in Massachusetts. For the best possible experience, be sure to work with an agent who is a member of the Massachusetts Association of Buyer Agents.