Buying A House in Frederick MD What do you need to know?

The Early Show had a financial advisor on this morning to talk about buying in today’s market.  So, I thought I would elaborate a little about it as it related to Frederick MD.  We are not too far off from what the rest of the nation is experiencing in the housing slump.  Our homes are staying on the market a little longer (116 days average time on market for month of May) than they did last year at this time (57 days.)  That’s twice as long than last year.   The prices have come down some since last year too (down 1.47%)   There are more than 2200 homes in inventory and there were 1800 last year. 

What does that mean to the average buyer?  You have plenty of homes to pick over.  Seller help (closing cost assistance) is available to buyers if needed.  You have a chance to get a good deal on some of the homes.   On top of this, the interest rates are still at historic lows.  Sure, there are some fluctuations in the loans, but you still have great programs to help you get into a house now.   

So where do you start?  First, you should pair up with a few good professionals; one being a REALTOR® and the other a trustworthy lender.   Finding a creditable lender will help you find the right loan program for your personal needs.  This will take the guess work out on what you can and cannot afford.   I always recommend a local lender incase there are issues, we can meet with them face to face and have them resolved quickly.  I say creditable, because I don’t like surprises at the closing table…some lenders over promise and under deliver.  

Meet with your REALTOR® (hopefully that’s me) and determine what you really want in a perfect home.  Then, what can you live with and live without in that perfect home.  This first meeting should entail some paperwork before going out to see houses.  In the state of Maryland, we are required to go over “Understand Whom the Agents Represents” and “Consent for Dual Agency.”  Other paperwork that will most likely be covered but it’s not limited to; Exclusive Buyer Agency Agreement and Personal Financial Information sheet.  Now, we are ready to go see some houses. 

I like to think as the first trip out as the reality check.   I don’t like to schedule more that 3-6 homes.  This will give you an idea of what your money will buy you.  It also allows me to hear what you really want in the house.   Sometimes that fireplace doesn’t matter as much anymore.   Then we can really hone in on the right house.  As your heads are in the clouds looking at the gorgeous furnishings and placing your imaginary furniture in the living room, I will be letting you know the shortcomings of the property.   You see, I am looking at the house to help identify potential issues…is that dampness I smell?  Why is that crack there?  Should you be concerned about that Factory over there?   

We found it…now what?  This is where the real work starts to happen.  We need to determine an offer price, closing date, what inspections are needed, seller concessions, and other necessities for your dream home.  Let’s take a look at the previous sales in the neighborhood to start.  Oh, the sellers are asking way too much!!!  Not only did the last sale go for lower than asking price but it they gave $10,000 in seller concessions (Closing cost assistance or decorator allowance.)  The average list to sale ratio in Frederick is 5%.  If you play the law of averages, some homes sold for the asking price and some sold for less than asking price by 10-15%.  Sellers know this and some strategically price their home to take in this average.   After we look at the recent sales, we will discuss a strategy and a starting offer price to get to a final contract price.  Now, the negotiations begin.  Everything you want out of this transaction is reduced to paper in form of an offer.  The offer will consist of about 40-50 pages.  (yes, you have to sign and initial most of them)  At this time you will need to write a check to cover the Earnest Money Deposit.   This shows the seller how serious you are about buying their home.  Now it’s time to take the offer over to the seller’s agent.  If we’re lucky, the seller accepts our offer.  Yeah, right.  Let the negotiations begin…  

Well talk more after they agree to our terms and conditions…

Bob is a licensed Real Estate agent in Maryland and Pennsylvania. You can contact him via email at bob@gotbob4homes.com or call him on his cell phone at 240-285-4918.  He has been the Assistant Manager at the Mt Airy office for the past two years. Not only does he list and sell residential real estate, but can help you with your commercial real estate needs as well. He has been a resident of Frederick County for the past nine years.