How do I buy a home in America? by Paul Mees

Europe has historically been one of the largest investors of real estate in America. Recent figures from the National Association of  Realtors, show Europeans are still one of the top five foreign investors in United States real estate.

The low valued dollar and the many real estate bargains attract a stream of foreign investors who would like to profit from the housing situation in the U.S. Foreign investors also discover that buying  real estate in America is a fairly easy process. On this site I will describe several aspects of buying real estate in America. It is important that you are represented by an experienced broker (Realtor) who is specialized in the area where you want to buy and knows how to deal with foreign investors who are not an American citizen or resident.

Before we continue I would like to introduce myself: my name is Paul Mees and for the last ten years I have lived, and worked as a Realtor in the San Francisco Bay Area. I am one of the partners of HarperMees and Associates. My wife, Ginny, and I own properties in California, Mexico, the Netherlands and Italy. In the past ten years, we have gained a lot of  experience through buying and selling of homes internationally. Our team of realtors is ready to assist you with the purchase of your dream home, or investment property, in America.

Complete 9 Page Document – How Do I Buy a House in America?

The following is from Tim Soldati, one of our strategic partners.

Being a mortgage broker, I get the luxury of working with real estate agents of all calibers. I’ve seen the great ones and I’ve seen the not-so-great ones. On a more recent transaction, I am reminded of the importance of working with an experienced agent.

A client of mine decided to by-pass his agent and work directly with the agent of the seller in hopes of saving money. That was problem number one, which I will save for another article.

The property in mind was a foreclosure. That fact alone warrants working with an agent that has experience working with foreclosures and short sales. This particular agent (who shall remain nameless) had no clue what he was doing (ok, it was a guy). When questions arose about time tables to contingency removals, it was clear that this may have been the agent’s first transaction. It was evident that just about every question my client had for the agent had a delayed response as the agent had to go ask his broker for the answer. It became more evident when my client would come to me for answers about the transaction as the agent could not respond in a timely manner, let alone know the answer.

Not once did the agent ever call me during the transaction to see how I was progressing along with the loan side of the transaction (a vital part of the ability to close the transaction). I made a point of contacting him regularly just to keep him in the loop. If it weren’t for that fact, I don’t think I would have ever talked to the agent. A good agent will be the point of contact for the entire transaction.

Then when problems started to arise, the agent made no effort to advise our mutual client. There were issues with asbestos, issues with the quality of the home, and even issues with foundation slippage. But as the agent was originally representing the seller, I think he was more interested in the deal closing rather than fulfilling his fiduciary responsibility to his client. Even the contract itself wasn’t written well that would protect my client’s interest and deposit.

In the end, the deal did close (mainly thanks to me). My client did get proper advice to each issue that arose. The agent was oblivious to most of the issues of the transaction and got to walk away with a commission unearned for the most part. My client was lucky. It could have been a lot worse.

So as you are considering hiring a real estate agent, be sure to ask him/her about their experiences and qualifications. Ask for references. Ask about the number of transactions they assisted on. In tough real estate conditions, it is even more important to be represented by those with experience. While many agents in this market went back to work or secured a day job, be sure you are working with a full time agent that is IN the business. Do not hire an agent that is working part time or on the side. Do not pay full price for part time service. Working with an experienced agent will protect your interest and save you money in the long run!

The client was lucky to have a wortgage broker like Tim, who was willing to take on the burden of assisting in areas where the real estate agent in quesiton should have been serving the client’s needs.

The role of your Realtor or real estate agent basically boils down to seven things:

• Education
• Analysis
• Guide
• Coordination
• Negotiations
• Detail Checking
• Problem Solver

There is a poster that lists about three hundred items involved in the sale of real estate. If you read it, you see things are being stretched a bit for effect, but that does not diminish the fact that an ordinary real estate transaction is an involved, complex and often complicated affair.

Tracey is a contracts fanatic. She has a background in bookkeeping, served as an assistant comptroller for a national builder, and then development sales manager for a national new home builder. She has crossed a bunch of T’s and dotted a lot of I’s.

I have seen her as the listing agent or the buyer’s agent have to handle both sides of the transaction because of incompetence, ignorance or lack of experience on the part of the other agent. I remember one deal last year where the agent on the buy side was also handling the mortgage. This person had their real estate broker’s license and in effect wanted to commit real estate fraud – not because he was a crook, but because he was ignorant of of the law.

When choosing a Realtor or real estate agent be sure to do your due diligence. Many Realtors and real estate agents come from backgrounds with no formal business training or skills. There are still many part-time agents in the business that divide their time between two or more jobs.

Find an agent with the skills, knowledge, experience and time that knows how to focus on you and your needs.

Related Article:

The 10 mistakes home sellers make 

Real Estate Fraud Averted

Agents balk at overpriced homes is the cover story in the Sunday Homes Section of the Contra Costa Times today. Kathleen Lynn of the New Jersey Record wrote the piece. Everything in quotes is taken from Kathleen’s article.

CCTimes says – They (real estate agents) don’t want to waste time marketing houses buyers won’t bother to look at.

This article strikes at the heart of the major challenge in selling a house – pricing it right.

• The seller wants top dollar
• The agent wants to get it sold

You can’t accomplish either of these goals if the house is not priced right to bring in the buyers. We (Realtors as a group) continue to meet sellers that think they control the price. They are sorely mistaken. They can set whatever price they want, but, in the end, the market determines the price.

In an appreciating market, you can set the price at the high end and the market will eventually find you. But, in the current market, if you set the price high, you will most likely end up chasing the market down and wind up losing more money than if you priced it right to begin with.

“Sellers tend to rely on agents to set their price, according to the 2007 National Association of Realtors profile of buyers and sellers. When asked what they want most from real estate agents, 16 percent of recent sellers said they wanted help in pricing the home competitively, the NAR found.”

In my opinion, the first sign you may have the wrong agent is when they ask you what your home is worth. (As a home seller, always ask the agent first, if they insist on you going first - thank them for their time and move on) An agent may be asking to see how far apart your price is from what they tend to suggest, but, unfortunately, there are still a lot of agents out there that lack the experience in real estate to price a home properly in a challenging market like today’s. It’s also sad to say that many real estate agents have little or no business background or negotiating skills. Thus, they tend to shy away from anything that looks like it may be confrontational – like talking reality with a misinformed seller.

“Sometimes that means they get news they don't want to hear. Two years ago, for example, she did a market comparison for a couple thinking of selling. At that time, she valued their house at $569,000. They weren't ready to sell then, but they recently came back to her because they are ready now. In today's softer market, she suggested listing the house at $539,000. The sellers' reaction: ‘Are you kidding me?’”

There is hope, though, for all involved. Housing prices seem to be stabilizing despite continuing negative media coverage. The effects of the new lending standards have had their effect in reducing the number of qualified buyers available. This is especially true in the first time buyer market – which influences the move-up buyer market.

Continued downward pressure on local housing markets is going to come from continued foreclosures in the immediate area or price slashing from new home builders that are trying to survive.

Price it Right – Get it Sold!

I was talking to a Realtor friend recently and she related to me a story that exemplifies the value in using a Realtor.

Of course, the first course of action on the part of a buyer or seller is due diligence to ensure they choose an ethical, knowledgeable and skilled professional.

My Realtor friend’s client decided to attend a recent auction to bid on a condo. There was a great deal of planning and preparation the real estate agent had to do prior to the auction to ensure that she and her client had the best possible chance of success.

The auction was hectic and confusing for first time people. The auctioneer was increasing the bid by $10K increments and the client did not want to bump the existing bid by $10K. The Realtor informed the client that she could bump the bid by whatever she wanted. So, the client bumped it by $5K and was successful with the bid.

They were ushered off to complete the transaction and the first hiccup was that the auction people had a sales figure $20K above the bid. The Realtor challenged this and in abut 20 minutes they got the sales price corrected.

Next was financing. They were sitting across from a major lender and the Realtor asked the lender – Don’t you give some kind of discount to your employees? Sure, they said – we cover the closing costs. Well, this woman works for the bank.

The real estate agent then asked – can we buy down the interest rate? Sure, for $800, you can reduce your monthly payment $600 a month.

The point is that transactions are complicated and confusing at times, an experienced, knowledgeable third party can help reduce the client’s stress and frustration and often save them a ton of money.

We have 5 professional Realtors on our team with proven skills and knowledge. With over 650 closed escrows, we have plenty of clients that will vouch for our performance and character.