Tips for buying property

Tips for Buyers


Commissions paid by seller

Although there are exceptions to this rule, generally in all transactions the seller pays the commissions which means our services are free to the buyers. Exceptions to the rule are usually commercial or more complex transactions. So, as the buyer you will want to take advantage of having a real estate professional represent your interest.

What's a buyer's rep agreement?

A buyer's rep agreement establishes the relationship between a buyer and their agent. It helps to protect your interest by establishing a legal framework for how we might represent you. It's required in Texas as a way to ensure buyer's and their agents are protected through the relationship. In fact, without a buyer's rep agreement, under Texas law, agents technically represent the seller. That means that technically, without a buyers rep, there is no one protecting your interest during negotiations.

Here are a few reasons why you want representation:

 

Customer Level Service
(Not represented)

Client Level Service
(Represented)

Honesty

X
X

Fairness

X
X

Accountability

X
X

Reasonable Care

X
X

Disclose Material Facts

X
X

Undivided Loyalty

X

Confidentiality

X

Full Disclosure

X

Objective Evaluation

X

Price Counseling

X

Negotiation Assistance

X

Work for You

X

Directed by Buyer

X

 

Residential

When looking at a residential property you will want to ask the seller if they have a copy of a previous home inspection report. Most likely they won't, but if they do, then it's important to know the condition of the home when it was last purchased. In any case, hire a professional licensed home inspector.

Commercial

Commercial properties are particularly problematic. If you are considering a commercial building, you may want to do what's called a phase 1 environmental inspection. You may also want to get a materials inspection of the materials used in the building. An inspector will take samples of various materials to look for hazardous components.

Depending on the outcome of these inspections, you may want to go to a phase 2. At this point you will start to spend a lot of money so you will want to know the risks. It's also a good idea to get a structural inspection by a licensed engineer if the building is older or showing signs of instability.

Disclosures and cautions for foreclosures and rental properties

Disclosures also help you to understand the current shape of the property. Homes occupied by the sellers are required to disclose what they know about the property such as flooding, insurance claims and current damage. When a property is in foreclosure, technically, the owner, which is usually a lender, doesn't have to provide disclosures. Why? Because they don't occupy the property so they don't know the particulars of it's current condition.

Likewise for purchasing rental properties, the owner doesn't occupy the home, so the disclosures may not be accurate. Since the owner doesn't occupy the home, they won't know the particulars. Often the tenants are gone before landlords get into the property. At that point they can choose what to repair based on what they can find. While not intentional, they can miss problems since they haven't occupied the home.

Regardless of the property type, you will always want to hire a professional inspector qualified for the particular property type.