2. Agenda Considering… To Buy or Not to Buy Market Conditions How to Search for a Home Looking… Working with Redfin Finding a Redfin Agent Pre-approval Break! Buying… Mortgages Short Sales and Bank Owned The Offer and the Deal Considering… Looking… Buying…
4. Why You Should Buy a Home You’ve got a family, and need room to grow You want deep roots You want a type of property that is difficult to rent You’re handy, and ready to invest your time in your home You’ve saved up a down payment Considering… Looking… Buying…
5. Why You Shouldn’t Buy a Home You don’t have a good reason like family or schools You can’t afford a 10% - 20% down payment You can rent for much less You plan on moving soon You’re worried about job security Considering… Looking… Buying…
7. Case-Shiller: DC v. 20-City Case-Shiller: DC AreaUp 3.7% year-over-yearPeak was May 2006Down 25.7% from peakCurrently at May 2004 prices Case-Shiller: 20-City CompositeUp 2% year-over-yearPeak was July 2006Down 30% from peakCurrently at August 2003 prices Considering… Looking… Buying…
12. Why Redfin’s Search is Better All the homes for sale: 30% more listings You see what the agent sees: 4x the data Real-time market data: photos, details of just-sold homes Considering… Looking… Buying…
13. Searching on Redfin Get email updates Find open houses Redfin’s Forums See more trends & details Exclude short sales Search recent sales Download to Excel Considering… Looking… Buying…
14. Home Details Page Go see the home Home info Different map views Local school info History of the property Add to Favorites Neighborhood area pricing Agent write up Mortgage Calculator
15. Add Homes to Your Favorites List Order by price, listing date, etc See your notes Considering… Looking… Buying…
17. Working With Redfin is Different Service Advocates: client-satisfaction bonuses, not commissions Transparency: informed decisions Best Agents: The right home for the right price No obligation Switch Redfin agents Pause and re-start your search any time Refund You get up to 50% the commission The Best Results Service: 97% would recommend us to a friend Considering… Looking… Buying…
30. Now You are Ready to Tour Up to six homes per tour in two hour blocks Go on as many tours as you would like Led by field agent No commitment Considering… Looking… Buying…
35. Make Sure He’s a Good Fit Click here when you decide See all deals & reviews Team members & roles Considering… Looking… Buying…
36. What to Ask Any Agent Is this your full-time job? Familiar with foreclosures or short-sales? Where were your last five deals? Who else will be working with me? Will you show me all properties for sale? When am I committed to working with you? Has a client ever filed a complaint? How are you paid? Considering… Looking… Buying…
37. Get Pre-Approved A pre-approval letter is a letter from a bank or a lender estimating how much they'll lend a borrower Help you establish how much you can afford and makes offer process go faster Information needed: W-2, two pay-stubs, tax returns (get them ready), bank statements The process only takes a few days while banks get everything verified The approval is good for 90 days, depending on lender Ask for a few different amounts Redfin asks that you get pre-approved before your third tour Considering… Looking… Buying…
40. Organize Your Assets Get ready for the down payment Cash accounts (liquid funds) 401(k), stocks, other investments Gift funds? (Max. allowed varies) Move funds around before you start shopping Considering… Looking… Buying…
41. Review Your Debt Pull credit report, look for errors Figure out how much monthly income goes towards paying off debt: 28 – 33% healthy Pay down balances to 1/3rd of credit available Don’t open any new lines of credit Don’t buy any big ticket items Co-borrower will need to do the same Considering… Looking… Buying…
42. Start Shopping for Lenders Compile a list of 4-6 lenders & brokers Good sources include: Redfin's partner lenders Referrals from friends, family & co-workers Banks or credit unions you have accounts with A large, national bank with an advertised rate Your real estate agent Online review sites, such as Yelp Considering… Looking… Buying…
43. Local Recommended Lenders *In no way does Redfin benefit financially from recommending lenders – we just think they are great lenders! Considering… Looking… Buying…
45. Comparing GFE Results Gather Good Faith Estimates (loan quotes) A minimum of three, more is better Compare similar loans Program (FHA, conventional) Timeframe (same day) Compare costs side-by-side Discount & origination points Interest rates Insurance premiums (FHA, PMI) APR (interest rates + fees + points + PMI) Considering… Looking… Buying…
46. Make Your Decision When possible, get a loan commitment Lock your interest rate (30 - 60 days) Make alternative funds liquid (401k, stock) Good news! Loan payments are made in arrears, so your first loan payment won’t be for two months. You’ll have one month of no payments. Considering… Looking… Buying…
48. What is a Short Sale? The owner owes more on the mortgage than the home is worth Usually pre-foreclosure, but not always Listed for less than what’s owed to the bank Requires 1 - 2 banks’ approval (usually 2) May have other liens (taxes, utilities, HOA) Considering… Looking… Buying…
49. We Can Help With A Short Sale Tour short sales with Redfin If you want to buy, Redfin refers you to a short sale partner agent Redfin partner agents work for other brokerages but share Redfin’s commitment to customer service Get a 15% commission refund Considering… Looking… Buying…
50. What is a Bank-Owned Property? A foreclosed home owned by a bank or lender Standard sale but: Verbal negotiations Long response times Repairs unlikely Legal addenda may require an attorney Limited or no disclosures Banks demand use of their own contracts Bank can back out any time until they’ve signed Contract often requires early release of earnest money Considering… Looking… Buying…
51. So…Where’s the Best Deal? Bank-owned & short-sales myths – Always the best deal? Banks are stingy Not a fire sale Your best bet for a good deal: Sellers who own their home outright Sellers who are relocating Estate Sales Short Sales with hardship packages Considering… Looking… Buying…
55. Your Agent Negotiates Deal Researches seller Reviews agent-only comments Contacts listing agent Studies listing agent negotiating patterns Studies sellers situation and motivations Discusses with you Do you want a comparative market analysis? Where do you want to start? Where do you want to end up? Crafts Offer to Purchase Inspection contingency Financing contingency Submits offer Negotiates terms Considering… Looking… Buying…
64. So What Now? Make sure it’s the right time for you Get pre-approved & look for a lender Search for homes & start touring Find the right agent Make an offer & close the deal Considering… Looking… Buying…
65. After Class… Please fill out the survey we’ll send this week along with this slide deck. We’d love to get your feedback on how the class could improve. To get even more info on the home buying process, check out our home buying guide: http://redfin.com/home-buying-guide Considering… Looking… Buying…
69. Favorite Real Estate Links Property Information PropertyShark: Zoning data, title history, permits, neighborhood data; navigation is clunky Neighborhood Information WalkScore: Proximity to points of interest Trulia Heat Maps: Median prices across a county
70. Favorite Real Estate Links: Listings Redfin: MLS + FSBO + REO, updated every 15 minutes, with DOM, price history, Zestimate craigslist: Major FSBO source that Redfin can't crawl HotPads: Foreclosure heat maps Brokerage site of listing agents: more photos of the listing RealtyTrac: Foreclosure market detail, subscription required for full reports
71. Favorite Real Estate Links: Pricing Data Case-Schiller Indices: Pricing trends by metropolitan area HouseMath: Compares a housing investment to a stock market investment Altos Research: Median price trends and days on market by city, but some complain data is unreliable MSN Home Affordability Calculator: Based on your income & credit score SmartMoney's Home Buying Worksheet: Similar to the MSN calculator, but requires more info
72. Favorite Real Estate Links: Mortgage Bankrate: Many ads, but is great for comparing local lenders Zillow's Mortgage Marketplace Help Center: Articles mortgage rates, types of mortgages, credit reports, and a series of mortgage calculators The Mortgage Professor: Bare bones information on mortgages, definitions of common terms, myriad of mortgage calculators HUD FHA page: Most reliable explanation of FHA loans, good site for first-time buyers
73. Favorite Links Loans for First-Time Home-Buyers Federal Housing Administration (FHA) Fannie Mae and Freddy Mac CalHFA: California State agency that helps certain buyers Government Sites Federal Trade Commission: Articles & alerts for home-buyers. Dept. of Justice: Role of competition in real estate
74. Favorite Links Cont. Remodeling & Renovations DoItYourself.com: A few ads, but a useful clearinghouse of information on remodeling National Association of Home Builders (NAHB): Articles on remodeling your home, most are good What to Look for in an Inspection American Society of Home Inspectors (ASHI): Good consumer FAQ & virtual home inspection
Editor's Notes
Redfin refunds 50% of the buyer’s agent commissionApplied to closing costsRemainder paid as a check within 10 days of closingRefund is tax-freeMinimum Redfin fee: $6,000
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Point out reviewsUpdating this page: This should be updated based on your Local Rec. Lender. Just go to the page click “Print Screen.” Come back to this page, click on the large image, click delete, and then right click and paste. Size the images so it fits the page. The right click again and click “Send to back.”
Address in here how your agent fights for you in negotiations
1. Important milestone tracker – click on these for more in depth infoDeal room provides you with step by step updates on where you are at in the process after you have made an offer 2. Get updates from your agent when they have made changes to your Deal Room
You should not be reading all of these. Pick you top three and chat about those.
You should add your own key take aways for this and every class
