Real estate buying @ Masterclass.com

 4 things to consider:

Home - #beds, move in ready

Neighborhood - city, community, what you feel

Timing - your urgency, market timing

Budget - price range, pre-approved, how much down (locking your bank account in a home?)

Other expenses / surprises

- job growth

- mortgage

- quality school

- low interest = high demand = high price

Rent

- feel the place out

- when you don't want to be locked down

Location

- jobs growing is important - price of home will increase - tech jobs (Seattle / Boulder/ Austin / Nashville / Denver )

- where the artists go

- Quality of life - communtiy,  "home", belonging . stability, vibrance , calm, coffee shop

- commute

- different times of day, week

- businesses opening up near /school days / bus station / club

- diversity / people coming from outside

Agent

- calms and simplifies and makes it easier, connects the dots

- tours , valuations, photos, contracts, floor plan, market, stage and renovate

- listing is just a listing

- an agent is the difference between a calculator and a spreadsheet. finding the best options in your criteria

- selling history / sound / traffic

- what's happening around, what will be in the news in the future

- reputation - experience of a decade, an expert

how to find the right agent

-  referral from friends in similar neighborhood

- can you get along with them /personality

- great deal of experience (how many buy / how many sell

- if new - who are they working under

- what %age of business are referrals or repeat client : > 80%, if 0 , end that meeting

- relationship with other agents in the community / how often do you work with them / what %ge of your deals are with others / will they share it with you first or someone else

- mistakes we make together 

- what will success look like? what will fail look like 

- share inventory with others / what do you have that's not on public sites / private exclusives

- how do you ensure we won't overpay / negotiate best price / not lose an offer

- who other advisors should i hire / best inspector / best mortgage guy / why?

- agent has seen and recognize patterns

Information

info online is a fraction of the info you need to know.

MLS - 100s of them across the country - slice and dice

Commissions:

The seller buys the seller agent as well as the buyer agent : say 3% and 3%

If you go without a buyer agent , a seller will be happy to not having to pay a buyer agent

getting a fair deal, having advisors is insurance that you will have a good to great scenario

Timing

Spring market / fall market - when people list homes because they believe there is a disproportionate demand / supply during this time.

happens becuz it's time right before people are going to new schools.

also people travel during summer and winter.

If you want less competition to buy - it's end of August and the winter , but also less inventory

less competition also means less inventory

Current situation

Houses are not being built. 

Prices will increase in this country. Demand for more footage and more rooms. 

in 35 years demand is higher than supply. but you have to cut this data by type of home or even the next. street that's in a different school distirct, city.

Reading tea leaves:

when people say real estate market is great it could mean :

- prices are continuing to go up

- lot of trxns

- interest rates are low

- lot of inventory

- could be great for buyers : negotiating leverage because of number of listings.

- or sellers market - little inventory

- over decade , it usually goes up

- headlines say "skyrocketing" - time to question and pause . bubble

- things are bad, people are leaving, slow market - not a bad time to buy

Decoding a real estate listing

- create alert on location and price point, how quick up and down, prices

- days on market : 300 days - unrealistic seller OR a seller who is willing to take a reduced market

- days on market : 1 day - take advantage

- status : active means available 

- year built : proxy for quality of home / renovated at any point? architectural aspects like pre-war buildings / comfort of post-war building. 

- architecture : victorian / craftsman / colonial / cape cod / contemporary / ranch

- taxes - down payment + mortgage + TAXES + hoa( goes up in future - know future expectations ) 

- last asking price - strategy to get the right buyer at the right place - the strategy will lower this price or higher it depending on what they are trying to get - get more buyers and bid up, or get high bids and negotiate down in high end markets. 

- price per home / sqft - helps normalize to other properties

- not all sqfootage are equal - some are more renovated / has more exposure / higher ceilings / better schools , so sqft is a benchmark

- look beyond photos : photos always look better or even bigger. Always look at the home. wide angle lenses. getting people to open houses. 

Open houses:

- get brochure / neighbourhood / when renovated 

- has the home not been sold for long time - why?

- history of the home - how many owners - why so high now?

- digital walk through : virtual / live tour / 3d tour - dangerous to use that experience without seeing home. 

- go with agent

- moving reeady /

- strong infrastructure / light / pool / office

- window / sunlight / east

- room placement / dimensionality - kitchen / bedroom. dining / room

- pretend you're in a flea market - don't share your enthusiasm.  ask price with bored look

- don't let perfect get in the way of good - be happy with a compromise, in 80/20 maybe 10 will be renovate-able.

Do your homework

- find the listing agent strategy - find the lister - find other homes listed by them - what's the average difference between their closing price and listing price. that's how you find if his strategy is to underprice or overprice. over 3 mos / 6 mos for same home type and same neighborhood. so if he has sold at 5% less , we will start negotiate at 6%

- put an offer quickly for a good one new on market. look fast, quick offer, but very slow to counter.

- when a seller agent has to decide between two equal offers, he will go with a buyer agent he is familiar with and is more confident about the bid being real. 990K over 1 mill when it comes from a certain buyer agent VS unrepresented buyer.

- say 'Bye' when you say 1 and seller say 1.5 then you come back at 1.05 and seller still says 1.5.

Closing a home

- title - make sure they actually own it / title insurance

- 2 - 5 % of total value - closing costs

- TV = home cost - mortgage + origination fee + transfer tax + inspector fee + title + moving costs + paint/ finish walls + new furniture

- Cost of your time

Appraisal Process

not the actual value you are paying but what the appraiser states as value of home for tax purposes.

inspection : hvac replacement / heat water / stove / leak through the wall / wall or roof or floor replaced. My inspector says it's going to cost 50K to repair stuff, as a seller will you put into it? or negotiate some price.

Selling - important questions

- important to know even for a buyer

- timing : by when you want to sell / need the cash? / before buying your next home?

- price ? flexibility, after tax proceeds?

- time or price?

- convenience : Privacy (sell off-market) / every sunday you have to make time?

- renovation / stage

- agent - mover / contractor / title / escrow

- Spring market

4 things to consider to sell

- who is the agent? - work with / experience in neighbour 

- sell when

- fair price / comparative market analysis

- listing price - up or down depending on market

- marketing strategy / photos / description / listed everywhere or slowly privately

Agent

- right price

- for sellers agent if you ask a discount and they say no, that's good. good advisors don't discount. 

give yourself time to sell:

- single family - much faster

- co op or condo - 3 mos to close after price to go through the co-op org

- which price point sells in comparative market analysis

- you don't want to be in a place where you must sell immediately, you want to have time to sell

- empathy for customer - buyer's dreams - move your dreams away so you can fit the buyers dream. convenience. move in ready. painting. carpet with wood. kitchen appliance . cleaning. deep cleaning.

- small investment in staging improves selling process. easy - painting. carpet. 

- selling in 5 years - spend on painting now to enjoy it. but if selling next year - don't paint now cuz you have to paint again.

- 10K renovation can give you 100K profit. 

- great photos. - get people to the property.

- agent can explain staging combinations to get a visionless buyer to envision.

Real value of home ownership

home value increase + quality of living.

profitable but better than stock?

8 principles of entrepreneurship

Dream big

move fast

learn from reality - from the best , from the customers

solutions driven

ok to say no

collaborate without ego - no one succeeds alone

obsessing is great

maximize your strengths. minimize your weakness

bring others strength in

bounce back with passion - if your dreams are big enough you will fail

surviving and thriving

find the best team possible