Any investor who is serious about buying a property understands how important the open house inspection is. This is potentially your only opportunity to approach the real estate agent and get as much information as possible about the property. To avoid any nasty surprises after the sale, take a notebook with you and ask the real estate agent these seven critical questions:
1. Can you show me a recent property sales report?
First and foremost, what you really need to establish is why the agent or sellers believe the house is worth the listing price. A recent sales report shows what other comparable properties in the area have recently sold for, which gives you a fair indication of whether or not the house you are buying is reasonably priced.
2. How long has it been on the market?
Another key piece of information is to find out how long the property has been listed. If it has been on the market for any length of time, there’s a good chance it’s either wrongly priced or it’s a lemon. Also, if a property has been sitting for a while, you may be in a better position to negotiate if the sale is becoming urgent.
3. Why is the vendor selling now?
Knowing the vendor’s motivation to sell can be a huge advantage. Of course, if their reason for relocating is because of local crime or noisy neighbours, you may not get an honest answer, but be aware of any hesitation from the real estate agent or of answers that sound vague or sketchy. If the seller is moving due to purchasing another property, they’ll probably be more motivated to sell, meaning they’re more likely to lower their price. Which brings us to our next question…
4. Are the sellers open to price negotiations?
Ask what the seller’s expectations are for a sale price, and find out if they’re open to negotiate. At this point, many agents will want to know what kind of budget you have, but it’s wise to keep some cards close to your chest. Giving away too much information could be used against you in price negotiations and you may miss out. It’s unlikely that the agent will tell you exact figures the vendor would accept to avoid any lowball offers, but it never hurts to ask if counter offers would be considered.
5. Have you had any offers yet?
Asking if the property has received any offers is a good way to find out how much genuine interest there is in the property. This can help you make a decision on whether or not you should make an offer now or later, and gives some indication about whether or not the property is fairly priced. Chances are, if an offer has been made, the agent will be very eager to tell you in the hopes that you’ll make a competitive offer and drive up the sale price.
6. Has the seller done any renovations?
New appliances and a fresh coat of paint are easy to spot, but it’s important to ask how old the property is and if there’s been any recent renovations or upgrades. This information can assist you in working out if there’s any issues/repairs that could save or cost you money in the future. Homes with recent or significant renovations often tend to sell for more than older homes still in their original condition.
7. Does the property have any issues?
It’s important to ask the agent if the property has any issues that you’re unaware of which could potentially affect your decision to buy. Most problems will be detected in building and pest inspection before settlement, but asking the agent upfront could save you a lot of time and disappointment. Although you shouldn’t rely solely on what they tell you, most agents act in good faith and will tell you openly if there is an issue with the property that could affect the sale.
We strongly encourage buyers to ask questions at an open house inspection and learn as much about the property’s history, features, and the surrounding area as possible. While you should conduct your own individual research, it’s always a good idea to have a chat with the agent, because even if the property doesn’t turn out to be right for you, they may be able to help you find the one that is.