How to Buy or Sell Your First Home
The real estate market these days seems like a combination of fire and ice. As still as that sounds, some buyers and sellers are experiencing properties and transactions that are red hot deals, while others are getting iced with poor maintenance, missed opportunities, and bad decisions.
So what does one look for when buying or selling a home? More importantly, what do you look for when buying or selling your first home? It seems like such an easy thing when you see if on television, and “anybody can make millions” when pitched to you at a seminar, but what should you know and do walking into a sale?
In this episode, I’m joined by my good friend Stacy Massar of Massar Group Realty here in DFW, and she’s going to help shed some light on what you need to watch out for when buying, selling, or qualifying for a home. She’ll also let you in on some insider information about new construction and possible pitfalls to avoid. Take a listen and let me know what you think in the comments below. [Subscribe Here]
Stacy has been in real estate since 2003 and has spent time handling every branch of the transaction, including buying, selling, and mortgages, so she brings to us a ridiculous amount in insight. One of the reasons I have her on this episode is that I’m looking to buy a home with my wife soon (so it’s good timing), and I get emails about topics you guys want to hear. One of the recurring themes is real estate so you don’t get hosed. I’m here to help make sure you’re good to go, and I’ve got Stacy here to make it happen.
** This interview is not being completely transcribed verbatim because that’s just entirely too much text. I’ll paraphrase our questions and answers so you get good content, but for the whole thing, just go ahead and listen to the episode.
Blake Hammerton – Stacy thank you so much for joining me today. Today, it seems like everyone wants to be in real estate, or is a realtor. I know there’s the potential to make a lot of money, but it’s also quite stressful with long hours, balancing clients, and working in a fluctuating market. Why do you do it? What’s your story?
Stacy Massar – Thanks for having me! I think I just really like coffee and working hard [laughs]. You know, it started kind of as an accident. When I was living in Southern California in the early 2000s, I was out of college and ready to buy my first condo. It was a 2 bedroom, 2 bath with no garage, no view, 900 square feet, and $200k. I was in pure panic, so I read all there was to read and know about real estate buying, and then I grilled my poor real estate agent.
After the transaction was done, he asked I would work for him because I ‘basically knew more than he did now’ when it came to the transactions and paperwork. I argued and told him I was a teacher, not a real estate agent. This was about April and I had to wait until the school year began to start the year off again, so I had 5 months or so to wait. So I agreed to come in and help for the summer and see what happens.
And I just never went back to the classroom. I’ve been in some position in the real estate process ever since. From transactions and paperwork, to buying and selling, to even being the mortgage lender. It’s been an eye opener to be a part of it in California’s market and in the DFW Metroplex.
BH – I can’t imagine you as a High School English teacher. Knowing you since 2013, I can’t see you being anything other than a realtor. What else have you secretly got in your bag of tricks?
SM – I’m also a certified stager, which helps sellers feel like they’re getting more when they enlist me as their agent. I can help a seller get the house sold for the right price in the right time because I know what sells and what doesn’t, and sometimes that’s how the house is staged. I like to bring that to the table too.
BH – I feel like a lot of times, people will watch a couple episodes of almost any show on HGTV and feel like they can buy or sell or stage a home on their own, way overestimating their talent, and way underestimating the amount of work and research they’ll need to do. They feel like they can do it all for pennies on the dollar and it will be easy! Is any of that true in your experience?
SM – Unfortunately, no. Too many people watch transactions and rehabs happen on TV, but they forget about the ‘miracle of television’ – There are no labor costs, taxes, or any other fees on TV, there’s no time table, and it’s for entertainment so it has to work out in the end. Real life isn’t like that. They’re only seeing cost (usually wholesale too) on the show, which just isn’t true for most people.
I’ve never seen a kitchen remodel for $5,000. I mean, if you’re a contractor and you’re getting your own materials at cost, and you’re doing all the work yourself, you might be able to get it done for at or near that cost, but most of the people watching the show are not contractors and can’t do that. People get a false sense of cost and what’s really considered ‘sweat equity’ these days.
Slapping up some fresh paint, blinds, or ceiling fans really isn’t sweat equity. Real sweat equity – the kind we can employ if you’re looking for a fixer-upper or a house with a lower price point usually involves knocking out walls, ripping out flooring, cabinets, countertops. That’s a different story.
BH – So what makes your process different or better? What do you do to mitigate the false perceptions buyers or sellers may have when they come to you?
SM – We start off with an in-person meeting to go over your desires and deal breakers in your next home (if you’re a buyer), and what your ideal asking price, sell date, and bottom line is (if you’re a seller). Sellers will then go right to appraisal and we’ll have that conversation if things are realistic or not. Buyers though, really provide us with a leg up after this meeting. We know what they do and do not want, and it helps us avoid all the duds.
We also have them meet with their lender next. They’ll meet with a local lender than knows the market (not some national mortgage company that isn’t familiar with the buyer or the area), and find out what they can honestly afford and qualify for in home prices. With those two items done, we can show them all the best homes to fit their needs and their budgets.
The other myth we have to dispel is the time it takes to find and buy a home. On House Hunters on HGTV, the couple sees a few homes and chooses between the 3. It looks like it happens over the span of a week or so. In reality, that process takes a lot longer. I have worked with picky buyers that knew what they wanted and were patient enough to search for months with me until the perfect house showed up.
BH – So you have them meet with a local lender right away, huh? That’s what Jami and I did last year. We sat down and showed him our tax returns, credit scores, and general ledger (my wife likes to budget everything), and he was able to tell us what we could afford, and get approved for in our current financials. More importantly, he was able to show us what to improve right now so we could either afford more when it was time to buy, or simply have a smaller expense on our budget. We knew what to clean up now so we could be good-to-go later. That was huge.
SM – Yes, and that’s so wise to do. We have buyers meet with the lender right away so we can get an accurate picture of what they qualify for. They may tell us their budget is $300k, but their tax returns and financials show they’re really only qualified for $250k. A $50k price different makes for a very different house in many cases. That’s jusy an instant disappointment for the buyer. We can avoid that by getting our numbers cleared up in the beginning.
BH – In your experience, what’s the best way to find a real estate agent to help you?
SM – Ask your friends, family, coworkers. Referrals are always the best because someone else’s experience is better than calling the number on a sign. I know you want access to see the house with the sign, but calling the number without a real estate agent might not work in your favor. The agent on the sign will be willing to help you, of course, but he or she is hired to sell that house for the most amount of money, and your agent is to help you get a house for the least amount of money.
Get referrals from the people you trust and speak with those agents. Whichever one feels right and gets to know you and your plan the best, is probably the one to go with.
BH – Okay great. So I’ve got a real estate agent and my finances are in order so we know what I can afford. We’ve selected a house and I put in an offer. What happens next?
SM – Excellent, okay. We get an inspection. You always, always, always want to get an inspection on the home, and not an inspection from your father (unless he’s a licensed inspector) because this is more than kicking tires and judging. The inspector is paid to explore all the working parts of a home and find things wrong with it so you don’t unknowingly or unwillingly purchase something that’s broken. Inspections can range from $300 to $1000, depending on the size of the house, and it’s absolutely critical you get one before going forward with the sale.
Same with selling. Get a seller’s inspection before putting the house on the market so you can see what another inspector will find and can make repairs beforehand. It helps to reduce the amount of things the buyer’s inspector will find, and it helps you avoid any unnecessary delays or counteroffers due to repair requests.
BH – What about new construction? Here in Texas, things are building so quickly that new home construction often feels like the best bet for a great deal. Is the process the same?
SM – It’s very similar. There are two ways to purchase a home from a developer: new builds (designed and built for you from the foundation), and spec home (built already, but never lived in). My favorite is the designed from the beginning way. What we can do there is have an inspector come out after every phase of the construction. Laid the foundation, get an inspection. Framed the home and added plumbing and electric (no drywall yet), get an inspection. Completed and move-in ready, get an inspection. This way makes sure you’re covered with every step.
In a spec home, we still recommend an inspection because you don’t know the history of that home and whether the previous buyer had inspections done before. Builders are in business to put homes up while still cutting costs and turning a profit, right? We need to make sure they didn’t cut corners on the construction of your home in their efforts.
Going back to inspections on regular homes (not new-construction), whenever we have one come back with major repairs, we can either ask for a credit (price reduction) so the buyer can control the repair, or we can ask the seller to repair the issues before the sale. I always ask for a credit. The truth is, sellers want out of the home and asking them to make large repairs just to get out may have them putting bandaids on bigger issues. I don’t want my clients living in that home when the bandaid falls off. We they get the credit, they can hire their own contractor to complete the work to their standard. It’s just a better option, in my opinion.
BH – Okay, let’s switch gears to sellers. What mistakes do you see sellers make all the time – besides trying to sell it themselves as a “for sale by owner” adventure?
SM – Pricing their home based on old comps or emotion. Sellers will often look at their neighbors and price their own home higher. They may update their kitchen, bathroom, or pool and believe the home is now with $50k more. They pulled comps before remodeling and are using those numbers to justify their price. An appraiser is simply not going to use comps that are more than 6 months old. They’ll appraise your home based on current numbers and you might not like what comes back.
Remodeling is also tough because the $50k you put into your kitchen or bath definitely makes the house sell faster, but not for much more. You will very seldom get even half your investment back. If you put $50k in, you might get $15k in the sale. They look great, they photograph well, and buyers love it, but it doesn’t sell for a significant amount more than the area comps show. The same goes with a pool. Everyone loves a pool, but they come with their own upkeep, and they only grab another $10k in asking price on average.
BH – Jami and I like to go around looking at OpenDoor properties for fun. These are homes for sale by a company that operates with a app, offering buyers the chance to view the home without a realtor there. We like it because it’s fun and we like to look at home way, way outside our price range for fun. The thing that bother me, however, is that listing do not have to disclose the home was smoked in. We walk in and are immediately turned off. This is no good. What other mistakes do sellers / agents make?
SM – I agree about the smoking. It usually happens in homes owned by an older generation that have always smoked and it’s just how it is. If you’re a smoker and you want to sell your home (for a good price), stop smoking in the house immediately. You’ll need to repaint everything, replace the carpets and any fabric in the home, and get things professionally cleaned. That smell could cost you tens of thousands in your sale.
The other impacts can sound trivial, but they make a difference. For example, when your house is on the market, try to get your pets out of there. Even if the home is perfect, buyers will often walk away if there’s an annoying dog barking in the home or backyard. If you can remove your pets from the home, please do.
Remove personal items or pictures. Some buyers are so fascinated when looking at the personal items, they forget about the house. They’re more curious about who lives there and why they’re moving out instead. And finally, we’ve had buyers offer much less for a home if there was only one set of clothes in the master closet. They begin to think it’s a hardship sale and the seller needs the money, so they offer less. It may be that the husband moved first to start the new job, but the buyer doesn’t know or care. They’re going to offer less.
The bottom line is, find a real estate agent that is on your side. We’ve turned down working with sellers that refused to price their home correctly or had unrealistic expectations about the speed of the process. We also support when a buyer is insulted and turns down an offer without a counter. Even if that buyer comes back with a second offer that’s right on the money, we will refuse it if the seller is insulted or believes strongly against it. We’re partners with you, and that’s our job.
BH – Stacy, thank you so much for the insight! I know there’s so much more to learn, so how do people get in touch with you to buy or sell with you?
SM – You can always call or text me at (214) 649-3686 or email her directly. Those are the two fastest ways to reach me as we’re always doing things. I’ve got a team and someone is always available to help you. If you’re anywhere in the Metroplex, reach out. I would love to help you.
Gentlemen, the big takeaway here is to find a real estate agent that wants to partner with you. It can often feel like realtors are always pitching the idea that they can get you more house for your money, or will sell your home for more money in less time. Both of these are great things, but they don’t work if your realtor isn’t listening to you and knows what you want.
You’ll have more fun and get more of what you want when you take the time to work with an agent that puts your on their team so you have everything you need. There’s a lot more on the show, so listen in and leave a comment below.
Go boldly, everywhere.
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