All home buyers have one thing in common: They don't want to get ripped off. Whatever the state of the housing market, it's especially important to make sure you're paying a fair price. But how do you know you're getting a good deal even in a tight market before you make an offer? You need to know how to evaluate the price of any house in order to make the right investment decision. The following tips will show you how to get a great price on your home.
- Consider recently sold properties
A comparable property is one that is similar in size, condition, neighborhood and amenities to the one you are buying. One recently renovated 1,200 square foot single story home with an attached garage should list for about the same price as a similar 1,200 square foot home in the same neighborhood. This means you can also gain valuable information by looking at how the property you're interested in compares in price to other homes. Is it significantly cheaper than bigger or nicer properties? Is it more expensive than smaller or less attractive houses? Your real estate agent is the best source of accurate and up-to-date information on comparable properties.
- Check out comparable properties on the market
In this case, you can actually visit other homes and get a feel for how their size, condition and amenities compare to the property you're considering. You can then compare prices and see affordable housing societies in Lahore. Smart sellers know that if they want to be competitive, they need to price their properties similar to comparable in the market.
- Read about market conditions, valuation
Have prices gone up or down recently? In a seller's market, properties are likely to be somewhat overpriced and in a buyer's market, properties are likely to be undervalued. It all depends on where the market is currently on the real estate boom and bust curve. Even in a seller's market, properties may not be overpriced if the market is up and not near its peak. Conversely, real estate can be overpriced even in a buyer's market if prices have only recently started to fall. Of course, it can be difficult to see peaks and valleys until they become history. Also consider the impact of mortgage interest rates and the labor market on the economy.
- Beware of For Sale by Owner properties
A For Sale by Owner (FSBO) property should be discounted to reflect the fact that there is no seller's agent commission of 2.5% to 3% (on average), which many sellers do not consider when deciding how to proceed. Set a price for the house. Another potential problem with a FSBO is that the seller may not have had an agent's guidance in setting a reasonable price, or may have been so dissatisfied with the agent's suggestion that they decided to go it alone. In any of these situations, the property may be overpriced.
- Explore the expected appreciation
Future prospects in your chosen neighborhood may impact the price. If a positive development is planned, such as the construction of a large shopping center, the extension of a commuter rail to the neighborhood, or a large new company moves into the area, the prospects for future appreciation of the home look good. Even small developments, such as plans to or build a new school, can be a good sign. So get plots on installments in Lahore.
On the other hand, if grocery stores and gas stations are closing, the price of homes should be lower to reflect that, and you should probably reconsider moving to the area. The construction of new housing can proceed in both directions. This can mean that the area is hot and likely to be in high demand in the future, increasing the value of your home.
- Ask your real estate agent
Without analyzing the data, your real estate agent will probably have a good feel (through experience) of whether or not the property is valued fairly and what a fair asking price might be.
- Ask yourself: Does the price seem fair to you?
If you're not happy with the property, the price will never seem fair, even if you're doing well. Even if you pay a little above market value for a house you love, you won't really care in the end.
- Get an award and an inspection
Once you have a contract, the lender will have the property appraised (usually at your expense) to protect their financial interests. The lender wants to make sure that if you stop paying your mortgage, they will be able to get a reasonable amount of their money back when they foreclose on your home. If the valuation is significantly lower than your bid price, you may not be getting a fair deal. In fact, the lender won't even let you buy the house unless they're willing to lower the price. A home inspection, also completed after you have a contract, gives you another way to gauge your offer price. If the home needs a lot of expensive repairs, you'll want to ask the seller to do the repairs for you or discount the purchase price so you can do them yourself.