In This Issue

Whose Market Is It? The Offer Ingredients Go Green

We are pleased to present you with the latest issue of Life@Home.  Delivered to home buyers, sellers and owners on a monthly basis, this electronic newsletter is designed to give you the real estate information that is important to you.  In each issue, you will find practical tips and articles related to buying, selling or owning a home, as well as the latest news on real estate trends.  We hope that you enjoy this issue of Life@Home.  If we can be of any assistance, please do not hesitate to contact us.

Whose Market Is It?

Real estate is a cyclical business. For months or even years conditions may favor the buyer. Then, over time, the pendulum will swing the other way and circumstances will favor the seller.

The market forces of supply and demand help determines whether it is a buyer's or seller's market. When the supply of homes is high, the sense or urgency for buyers lessens. Because there are more homes to choose from buyers can be more selective and may wield more power during the negotiations. In turn, sellers may need to lower their asking prices to attract consumer interest.

Conversely, in a seller's market, inventory is lower. Buyers have fewer options and the sense of immediacy is heightened. As a result, the number of bids on any given listing may increase, asking prices might rise, and buying terms may become more stringent.

A second factor that influences the market is mortgage interest rates. High rates mean it costs buyers more money to borrow from a bank or lender. Higher rates can lessen consumer demand. On the other hand, when rates are lower and buyers feel they can get more for their money it can propel them into the real estate market.

If you are considering buying a home it is critical that you determine whether it is a buyer's or seller's market. Equally important is to remember that real estate is local. Different factors could make it a seller's market in one city and a buyer's market in another. To help you determine which conditions prevail examine how long listings are staying on the market, compare that rate to six months ago, and look at whether homes are selling above or below asking price.

Your real estate agent should be an expert in your local marketplace. His or her insight will be key. Remember the market climate buyer or seller will ultimately influence your decision when to buy and at what price and terms.

The Offer Ingredients

It's the moment you've been waiting for, your Realtor has called and said the couple who visited your open house earlier in the week has made an offer. Although adrenaline will be high, it is important to remember that the "offer to purchase" is a starting point for negotiations. The buyer is issuing a bid that you can accept as is, rework through discussions, or reject outright.

Here's a closer look at some parts in an offer:

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Earnest money - In most cases the buyer will give their agent or attorney a check, say $500, to show they are serious.

The purchase amount - This will include the amount of the down payment, the remaining balance and details about the buyer's financing.

Closing Costs - The offer will delineate which party will pay for certain professional and service fees.

Inspections - Structural, pest, lead and radon are some of the common inspections required by the buyer.

Contingencies - These are clauses that allow the buyer to exit the deal without penalty if certain conditions are not met. For instance, if an inspection reveals a compromised foundation, the buyer would probably be able to walk away without consequence.

Time tables - A timeline will be laid out for the entire purchase process, from inspections to the date of the closing.

How to settle disputes - In the event either part is dissatisfied, the offer will include guidelines for the appropriate course of action.