Buying a house can be a daunting process at any time, with it being the largest purchase most people make. It may be especially so right now because of rising in housing costs and interest rates plus the limited market of houses available.
This is part 2 of an email course from the Wichita Journalism Collaborative that guides first-time buyers through the process.
You can sign up for the course at https://wichitajournalism.org/newsletters/.
Lesson 2: You’re ready to start shopping for a house. What now?
For this step of the course we’ll hear from Kati Harper, a longtime real estate agent. She’ll walk you through the process of shopping, and how to find the right fit for you.
Before Shopping
Once you know you’re ready, Harper says the first step is getting prequalified for a home loan. Prequalification will tell you your price range. It will ensure you’re not wasting time and energy looking out of your price range. Prequalifications also help you to know what your highest final offer can be.
Harper said she still feels it’s a good time to buy for those who are ready to start looking. Do not be discouraged by the interest rates because historically they’ve been as high as 9%.
Finding an Agent
After that you’re ready to really begin the process, and it’s time to find an agent who will guide you through the process.
Harper said finding an agent you trust and feel comfortable with is essential. They know what to look for and how to handle any issues that come up while buying a house. A good agent can guide you through these steps and offer solutions.
“We’re in and out of houses all day,” Harper said. “We can see things to look for.”
Harper said to ask friends or family you trust for referrals. If that doesn’t yield anything, there are lists online. SCKrealtors.com provides lists of realtors in the Wichita area. Harper recommends interviewing a few to find someone you feel most comfortable with. Keep in mind that the seller usually pays real estate agent costs, so don’t let that deter you from going with the agent you want.
Harper recommended asking how long they’ve worked in real estate and what market they are most familiar with.
“Really it’s who fits with you the best,” Harper said.
Harper said a good agent will know the laws around housing and be able to guide you through them.
Viewing houses
After you’ve found an agent, the next step is looking at houses. Harper said to keep in mind that agents can show any house, not just the ones with their company.
Harper said while looking at houses, it’s important to watch out for these “big items”: roof, heating and air, foundation, plumbing and siding.
Issues with these parts of the house can affect insurance rates.
Harper said good agents will be able to point out issues with the houses you’re interested in and keep you grounded.
Harper said the amount of time buyers have to consider houses right now varies based on location and pricing. Do not wait too long if you’re interested.
“If it’s one you really like, don’t drag your feet,” Harper said.
Making an offer
Harper said it’s important to have the prequalification letter once you find a house you like to avoid delays while preparing to send an offer. If you have that letter, your agent can sit down with you to write an offer. Harper said a good agent will know and be able to guide you on what a good offer is.
Harper referenced a time a couple years ago when houses were selling way over asking prices. She said at that time, to avoid the confusion, she would write an offer that included an escalation clause, stating that the buyer would offer $1,000 over the next highest offer up to whatever her client was approved for. This meant they weren’t going over budget, and avoided the stress many buyers were dealt with in trying to guess whether their offer was too low or way over everyone else’s.
The type of loan you have will also determine what house you are approved to make offers on and what condition they can be in. Federal Housing Administration loans are more difficult to get approved and houses have to be in better condition. Because of this, Harper said some sellers will accept a lower offer from a conventional loan in order to avoid the hassle of repairs often required for an FHA loan.
Harper said FHA loans require more repairs up front because of the lower down payment requirements. With conventional loans, Harper said, the lenders can see that buyers have more money on hand for repairs.
Harper said another option is to include an offer contingent on getting certain repairs done.
Harper said common repair requests include:
- Fixing roof issues
- Electric repairs
- Fixing plumbing issues
- Fixing wood around windows and doors
- Fixing or replacing broken windows
- Peeling paint for FHA loans
- Adding handrails to stairs with three or more steps for FHA loans
- Having furnace cleaned and serviced
Harper said after an offer is sent you should hear back within three days.
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This article was produced by KMUW as part of the Wichita Journalism Collaborative (WJC), a partnership of 11 media and community partners, including KMUW.The WJC is embarking on 18 months of dedicated coverage to shed light on the pressing issue of affordable housing in Wichita.
