Jakemann Racing

When looking to buy a house, take the time to do your house research.

The available resources are limitless to the property buyer and investor. Here are just some of the resources we use:

1: The Residex ‘Top 100 Postcode Predictions’ and/or the ‘Best Rent Report’ (preferably both). We’ve found these reports to be extremely valuable investments and quite accurate. 

Use these reports to help establish the median (middle) price for properties in that post code and buy at, near or under the median price. Be aware that you need to conduct your own research into specific areas – don’t just rely on Residex (or any other) Reports.

2: Subscribe to Australian Property Investor Magazine AND Your Investment Property Magazine. In both our business and personal investing lives, these magazines are mandatory reading.

3: Terry Ryder’s Hotspotting Reports – Terry is a well credentialed and respected property investor and researcher. Terry’s reports are extremely well researched and have significant credibility in the market place.

4. You need to get out on the road and visit any location in which you’re interested, drive around to get a feel for the area and watch how quickly ‘For Sale’ signs go up and come down.  Contact a number of real estate agents in the area to confirm that the asking price is around the median (middle) price range and check the median price for the area on your Residex report.

5: Notice how close the property is to amenities such as schools (families are reluctant to up-root their children), transport, shops, jobs, café’s, universities, hospitals, etc.

6: Look for infrastructure development. Where government is developing or proposing to develop roads, parks, schools, shopping centres, etc., this usually provides a strong indication that people will move into the area which results in increased demand for property.

As a Buyers Agent, we understand that there are also many other valuable sources of research available…no doubt you will find your favourites as you continue investing.

“Research is cheap if you want to stay in business, expensive if you don’t” Anon

Where do first time home buyers go for financing? First time home buyers have many choices for financing.

However in today’s economic environment, a real estate buyer must typically have at least 3% to put down and excellent credit to get approved for financing. If a buyer’s income has decreased over the past 2 years or they have insufficient credit scores they may not be approved for financing even if they have 20+% as a down payment.

The good news is that most states offer educational courses that are low-cost or even free! They are designed to educate the buyer on options for down payment assistance and basic financing choices first time home buyers. Buyer’s agents can help to guide first time buyers to local programs .

There are also low-income buying programs like Fannie Mae, Freddie Mac, HUD, FHA, and RHA.

Fannie Mae stands for Federal National Mortgage Assistance. It was created by Congress in 1938. The purpose was to provide financial services and options for low- to mid-income families who wouldn’t otherwise be able to qualify to buy a home .

Freddie Mac is the Federal Home Loan Mortgage Corporation. It was chartered by Congress in 1970 in order to keep the flow of money going to mortgage lenders. Residential mortgage loans are bought by Freddie Mac and resold to investors. This raises the abundance of home loans and makes them more affordable.

HUD is the US Department of Housing and Urban Development,. The goal of this program is to strengthen communities and make homes more affordable in order to increase homeownership . Their Good Neighbor Next Door program gives teachers, firefighters, emergency responders, and law enforcement workers a 50% discount of the listed price of a home. Several agencies are part of HUD, and they assist families who have lower incomes to purchase or renovate homes.

Many buyer’s agents specialize in working with people buying HUD homes. HUD endorses buyers using exclusive buyer agents when searching for a home. “If you want someone to represent only your interests, consider hiring an “exclusive buyer’s agent,” who will be working for you,” this quote came from HUD in their In Shopping For Your Home Loan – HUD’s Settlement Cost Booklet.

The FHA insured loan is a Federal Housing Administration mortage insurance backed loan that has been afforded by FHA-approved lenders. This type of home loan is considered federal assistance.

Over time they have helped Americans who have lower incomes to obtain loans to buy a home they would not be able to afford without the borrowed money. During the Great Depression in the 1930s, this program was created as a form of substantial insurance fir the high-rate of foreclosures and defaults. Presently, it is used to assist people who are not able to afford traditional down payments and do not qualify for private mortgage insurance.

The RHA (Rural Housing Authority) makes direct loans to buyers, provides grants, and guarantee regular commercial loans for home buyers in rural areas. With a purpose of making rural America a more desirable place to reside, the USDA Rural Development program created this.

These are just some of the major first time home buyer financing alternatives! Buyers should never go through the home buying process without a qualified professional, like a buyer’s agent, to direct them and provide them with knowledge about their options. Buyer’s can find a buyer’s agent in their area who offers free consultations.

What is the reasoning behind the buyer’s agency agreements?

When a buyer has been working with an agent for a period of time, short term or long term, the agent will typically assist the buyer with the following:

• Email listings to the buyer that parallel the buyer’s requirements
• Phone the selling agents of properties that peak the buyer’s interest
• Advise the buyer about lenders and help in collecting preapproval loan letters
• Make appointments with the sellers to show homes
• Taxi the buyers around viewing homes, sometimes this accounts for many miles

So when the agent gets a phone call or email stating that the buyer has found the home of their dreams through someone else and signed a contract, the agent can be devastated that they did all that legwork and will receive nothing in return.

Generally a buyer will sign a buyer’s broker agreement or a buyer’s broker contract with their real estate broker in advance to writing a purchase agreement. A buyer broker agreement is an often overlooked aspect to home buying. These agreements detail specifically who will represent the buyer and the rights and duties of both parties. Although these agreements may differ in many ways, they are all designed to protect the buyer as well as the agent.

Sellers have formal listing agreements with the seller’s agent. The buyer agents expect to have formal agreements as well. Buyer’s agents are entitled to payment for their work just as seller’s agents are.

The Exclusive Right to Represent is the most commonly used form in California according to Elizabeth Weintraub in her Buyer’s Broker Agreements and Buyer’s Broker Contracts article in About.com. In the U.S., many different types of agreements are used.

The Exclusive Right to Represent buyer broker agreement says the buyer has the right to demand single agency. The buyer agrees to select one broker or agent to work with. In this agreement, the buyer is not responsible for the commission if another party pays it, and the commission is negotiable. If the buyer is informed, the broker or agent has the right to receive a bigger commission from the seller if the seller chooses to pay more.

Exclusive buyer representation means the buyer has hired the broker or agent and they will vigorously in the name of the buyer. Only through exclusive buyer representation can the broker or agent negotiate with unrepresented sellers, like FSBO (for sale by owner), for the buyer. When a buyer’s agent uses their negotiation skills to get the buyer a great deal, then the buyer’s agent has warranted their compensation.

There are a few things buyers should specifically look for in an agreement. Both parties should make sure they have a right to end the contract. Sometimes people just are not made to work together. Asking for a trial run of 1-2 days with the agent before making a decision to work with them is a smart move. Both the buyer and the agent should have listed responsibilities and duties to each other. This contract should be designed to protect the buyer and the buyer’s agent.

Finding a buyer’s agent to work with is an important and crucial detail to home buying.