Top Ten Tips When Buying Real Estate!

In today’s financial climate, real estate remains a solid investment in many areas. Educated buyers always get the most out of the real estate market. These top ten real estate tips will help you step into your next real estate transaction with confidence.

Tip #1: Hire the Right Agent!

Hiring the right real estate agent is very important. If you’re unfamiliar with the area, your Realtor of choice is a link to important information about schools, zoning, city and county regulations, neighborhood trends, construction and remodeling, and rental restrictions and property values. Each city has different laws governing what can and cannot be done with property. Sanibel is one of the most beautiful cities in the United States. Having experienced many real estate transactions on a personal level, I understand the situations and concerns of my buyers and sellers. I have owned island property for many years and have been through several local real estate transactions myself. From buying and selling lots to building new homes with local developers, investing in rental income properties and using 1031 tax free transfers, I don’t just sell island real estate; I invest because I believe there is no place in the world like Sanibel and Captiva. Whether you work with me or someone else, finding the right realtor is very important.

Tip #2: Use 1031 Tax Exchanges and Save Money!

1031 tax exchanges are tax-free exchanges of investment property. Section 1031 of the Internal Revenue Code is one of the last great tax shelters. If you buy an “as-in-kind” investment property within 180 days of the sale of the same property and are willing to increase the debt or value of the property, your capital gains tax can be deferred entirely. I completed a reverse 1031 tax exchange myself, using this powerful tax shelter I believe. See current Sanibel, Capiva, or Ft. You want to buy a Myers property in a 1031 tax exchange, or an investment property that will qualify for a 1031 tax exchange in the future. A reverse 1031 tax exchange is the same concept as a 1031 tax exchange except that you buy your replacement “in-kind” investment property in advance before selling the property being exchanged. Learn more about 1031 tax exchanges and how to use them to your financial advantage. Remember that an independent body must be a competent intermediary. Real estate can be bought and sold in a self-directed retirement account. Whether you use a traditional IRA, Roth IRA, SEP, or company plans such as 401(k) plans, Keogh, or profit-sharing plans, explore your options.

Tip #3: Pre-qualify for financing!

Pre-qualifying for a loan may not seem that important unless you find your perfect paradise property at the same time as another buyer. When a property is for sale, it often attracts more than one buyer. Once a seller accepts an offer, the two most important things to look at are the price and the contingencies. For some sellers, they are uncomfortable with the offer of a buyer financing deal. Eliminate any doubt in the mind of the seller by meeting upfront the amount you can spend on any property purchase. This is especially important if your dream property suddenly experiences a drop in value. When this happens, other buyers may come into the picture, and I won’t see the property before it goes “for sale”! Often a seller will take a financially strong deal at a steep discount. Be ready to make a deal together!

Tip #4: Location, Location, Location!

“Location, location, location”, while an overused real estate phrase, should still and always be a top consideration for you as the buyer! If something about the property’s location bothers you, know when you want to resell the property and it will affect any buyers you want to attract! It’s important to ask lots of questions, but it’s often difficult to know the right questions to ask if you’re unfamiliar with the community. This is why it is so important to choose and hire the right real estate agent to represent your interests when purchasing a property.

Tip #5: Get a Home Inspection!

Getting an inspection report done by a licensed professional building inspector of your choice will protect you from many defects that are hidden from view. Why gamble with such a large financial investment? A professional building inspector can point out areas that need to be fixed or are not known. A good inspector will give you a long report covering all systems in the home from electrical, plumbing, roof condition and structural issues. Once you receive a report, you can start renegotiating repairs. Usually, a seller will agree to make necessary repairs up to a certain amount of money. When a seller lists their property “as is,” they let you know that they are not willing to repair or replace any part of the property. If you are interested in an “as is” property and have not leveled the structure and are not going to build new, it is still best for you to get an inspection report. Don’t rely on the building inspector to look for termites and other harmful pest problems. Even if an inspector sees pest damage, it is best to have a separate termite inspection done by a licensed company that understands pests and can remove them.

Tip #6: Get a survey and title insurance!

Surveys show a property’s easement, encroachment and boundary lines. They surveyed a house in an established neighborhood and confirmed that the property’s boundary lines were maintained. As homeowners add fences, sheds, decks, garages, and other structures to their property from time to time, boundary lines may cross over, placing part of their structure on your property or vice versa. Surveying vacant land is also important for the same reasons as for a house, in addition, a survey helps determine the size of the house, or the amount of coverage that the lot allows.

Title insurance protects your investment from another party claiming an ownership interest in your property. Title searches can reveal liens placed on property by sellers or errors in past title transfers. The last thing you want to find out when you’re in the middle of a transaction is whether there are encumbrances on the property, such as tax liens, unknown owners, concessions or leases. If a claim is made after a property is purchased, a title insurance company is there to protect your title to that property.

Tip #7: Be realistic!

When it comes to real estate properties, “needs” and “needs” are very different. If every home you see has the upgrades you “want” but is out of your “want” price range…be realistic. Who doesn’t love a large, oceanfront, professionally decorated home or condo, with all the bells and whistles? Looking at properties that are out of your price range is always fun, but it can also be very frustrating and frustrating. Be realistic by viewing listings in your desired price range, tracking down a unique property that has the potential to turn into your dream home. Always look at the architecture of the home from the furniture, wallpaper and flooring. That’s where you get potential assets.

Tip #8: Use Contracts Wisely!

Contingencies in property purchase contracts are designed to protect you, the buyer! This may seem silly to mention, but it’s important to remember that you need to work with the seller to come to an agreement. Valid conditions for the discount are maintained by the seller. Common emergencies include building inspections, termite and pest control, financing and surveys. Many deals break down into smaller details, and easier to fix problems. Remember that sellers are passionate about their property. If you see that major repairs or replacements need to be done due to neglect or age, make an allowance for this in your price. The old adage “everything is negotiable” is still true unless you make the seller very angry and refuse to work with you. Try to avoid listing any cosmetic changes you want the seller to make as contingencies. Cosmetic changes are realistic, be realistic when writing a contract.

Tip #9: Understand Regional Health and Safety Issues!

An informed rental can help you understand other health and safety issues to consider when buying a property. Safety and health topics may include EIFS (Synthetic Stucco), indoor air quality, mold, radon, and lead paint. Many of these require the seller to sign a declaration, while others cannot apply due to age, type of construction or location of purchase.

Tip #10: Ask for information!

don’t be shy. When hiring a realtor to work for you, ask them to provide you with information. Want to see all the properties in your price range, with the features you want, or the homes you want a realtor to show you? You deserve all the information you need to make an educated decision. Can you buy a home that you feel is perfect for your family, but find out that you never found information on the same property that suits all of your needs? I offer many services to ensure my buyers always have information at their fingertips.

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