Buyer’s Guide 2013 by Maria Morton

Buying your next home in KC

We’ll go through the basics and legal disclosures today so that you understand how the process works. I’ll be there to answer your questions and make sure everything is done right so that your Closing is as smooth and easy as possible.

Market Condition Supply and demand define the cycle the market is in now.

Low Demand Supply High

Low Supply Demand High

Home Values

Greater than a 6 month supply of inventory indicates a Buyer’s Market; Less than a 6 month supply of inventory indicates a Seller’s Market.

The Absorption Rate

For Sale

Sold

Low supply + High Demand = High Absorption Rate = More Competition

+ High Supply + Low Demand = Slow Absorption Rate = Less Competition

Who Are Buyers?

53% of first-time buyers

were 25-34 years old while most repeat buyers were 35-

54 years old.

34% of homebuyers in

2012 were under 35 years old.

47% of all homes

purchased in 2012 were bought by first-time buyers.

*from NAR study

Where do buyers learn about the home they purchase?

Buyers Find

Internet

Real Estate Agents

Yard Signs

Friends & Relatives

Home Builders

Newspaper &Magazines

Seller Direct

2% 2%

5%

6%

12%

36%

36%

Action in our area over the last 24 hours.

Dynamic.

93% of first-time

buyers began their search on the internet before contacting a real estate professional.

87% of repeat buyers

began their search on the internet before contacting a real estate professional. *NAR study

Foreclosures Short Sales REO’s Bank Owned Corporate Owned HUD homes FNMA Freddie Mac For Sale By Owners Lease to Own Lease w/option Owner financing All MLS listings & Not yet listed homes for sale go in the sorting hat

Your agent uses professional software and connections to identify homes that meet your needs & wants. You and your agent eliminate all the homes that do not meet your criteria. You go see the homes that will work for you in your life.

Save Time

Showing appointments are arranged through CSS. Wear comfortable clothes and slip-on shoes as we may need to take our shoes off in some homes. Please remember that other people are arranging their lives around your schedule so timeliness is important. *Sellers expect buyers to be qualified before seeing their home.

Rolling Top 3

After each home we see IRL, rate it #1, #2, or #3 while it’s fresh in your mind. At the end of the day, you’ll know exactly which home you really feel most comfortable.

When you find the home you love, you can ‘think about it’ or you can act quickly. Remember that if you like it better than any other home you’ve seen, someone else may too. Try to avoid multiple offer scenarios if at all possible.

Open Houses

If you decide to visit homes without your agent, be sure to tell the agent at the Opens that you are being represented by your own agent. Ask your agent to give you a stack of their cards for you to give to the other agents. This saves you from being overwhelmed with other agents trying to represent you and makes it easier to sign-in at each Open you attend.

Making an Offer

In the 5,000 square miles covered by Heartland Multiple Listing Service (MLS), an Offer To Purchase Real Estate consists of:

1. Real Estate Contract & all applicable addenda 2. Earnest Money Deposit (EMD) 3. Proof of Funds in the form of a Letter of Pre-Approval from a reputable lender OR a Letter of Guaranteed Funds from your banker or trustee.

10 Year Price History in Brookside & Waldo

Determining what price and terms to offer: Your agent will help you build your initial offer based on comparable sales data, competing listing activity, and current market conditions.

Terms in the Contract may

include Price

Closing Date Inspection Period

Financing Mortgage Contingency

Earnest Money Home Warranty

Closing Costs

Buyers often focus

only on price but there is a bigger picture to consider when writing your offer.

Lead Based Paint Addendum Prior to 1978, all paint was manufactured with lead. Lead, if ingested, has been shown to cause brain damage, learning disabilities, and other health problems. A Lead Based Paint Addendum is required to be part of the contract on all homes built before 1978. Your agent will provide you with a Lead Based Paint Booklet.

Agency Agreements Sellers contract an agent to help them by signing a Listing Agreement. Buyers contract an agent to help them by signing a Buyer’s Agency Agreement.

Caveat Emptor—’Buyer Beware’ In the 1990’s Consumer Advocacy Groups finally won the long hard battle convincing the US Congress that buyers of real estate deserved the same rights of representation that sellers have always enjoyed. This resulted in the creation of Buyer’s Agency so that today both buyers & sellers have the right to representation.

Seller’s Agent: represents the Seller. This agreement is put in place before the home is listed for sale. List price, selling terms, and commission are determined between the seller & their agent. The Listing Agent (Seller’s Agent) promises, in writing, to represent and promote the best interests of the Seller.

Buyer’s Agent: represents the Buyer. The Buyer’s Agent promises, in writing, to represent the best interests of the Buyer, protect their confidential information, give their best professional advice and opinion, and deliver earnest monies on time.

Transaction Broker: is when an Agent represents both parties before the Buyer decides to buy the Seller’s home. (Unusual) With both parties written agreement, the Agent can convert to Transaction Broker. This means that the Agent is responsible for managing the transaction but may no longer offer advice and opinion to either party.

Designated Agency: applies to Seller or Buyer. Should something happen to the Agent in the middle of her client’s transaction, the Agent’s Broker would appoint another Agent to complete the transaction.

Commission is determined by the Listing Agent & Seller. The Listing Agent offers a percentage of that commission to the Cooperating Buyer’s Agent – aka Co-Op. After Closing, the percentage commission is paid to the Buyer’s Broker & Agent out of the Seller’s funds. Better Homes & Gardens Real Estate - Kansas City Homes charges a Broker’s Administration Charge of $210/side/transaction. This is paid out of the Buyer’s funds at Closing.

Commission

Negotiations A knowledgeable, experienced agent is invaluable during negotiations. You not only have the advantage of her sound advice and counsel, you have a buffer between yourself and the seller/seller’s agent should tensions rise. Your agent negotiates with your best interests in mind. Round one begins when you make your offer. There may be additional negotiations after the inspections. It is not unusual for sellers to become emotional after inspections so there is a waiting period built into the contract. When all parties come to agreement, the waiting period can be waived.

Inspection Period Begins at one minute after midnight once all parties have signed the contract. Your agent will help you arrange inspections including Whole House, Termite, and other inspections as indicated. Depending on the home, you may wish to get a chimney, radon, drain line, structural, or other inspection. Your agent will coordinate all inspections.

Resolution of Unacceptable Conditions We can use anything noted on the Inspectors’ written reports to ask the seller to fix any major, minor, or safety issues. No home is perfect but you want to be sure the home is without major defects before moving forward toward Closing. Remember that you can ask for anything but the more you ask for, the more likely is the seller to say no.

Resolved & Moving Forward Once the seller & buyer agree on the Resolution, the Title Company and Lender (if the buyer is using a mortgage) can begin their work.

The Title Company will run the title checks and begin preparing Closing documents.

The Lender will order an appraisal.

The Agents will send copies of the contract to everyone who needs one.

If the home appraises out, the Lender will begin final loan approval process and send to Underwriter.

Your Agent will monitor progress over the next few weeks so that you can close on time.

If your Agent, Closer, or Lender requests documents from you during this time, it’s very important that you get them what they need ASAP.

Closing In Missouri & Kansas, buyers and sellers close separately. This may be different from your experience in another location. A day or three before Closing, you and your agent will receive & review the HUD-1 Final Settlement Statement. This will have the final numbers for you. After you’ve signed all the documents and given your check, change in title will be recorded with the County Recorder. Your agent will give you the keys to your new home and you move in!

So, of all the agents in KC, why choose to work with Maria Morton? Maria is dedicated to guiding her clients smoothly through the process, providing all the information you need to make wise decisions. She is an excellent educator, advocate, advisor, confidénte, negotiator, and transaction manager. Maria actively listens to her clients so that she understands their needs, wants, and fears before helping them attain their goals. One of her clients said “She could have sold me anything but she didn’t; she was watching out for my best interests – the way it should be!”.

Tools for you

Scan the QR Code with the QR code reader app on your phone. See homes for sale as you’re standing in front of them. Proprietary local software updated directly from the MLS every 10 minutes.