Are you looking to purchase your first home? Here's some advice your real estate agent would like you to know...
1. Commission
There are real estate companies that give you back commission. These discount brokerage firms advertise a "rebate" to attract new buyers.
When you are a buyer, your real estate agent gets compensated by the seller. That is, when a seller signs the listing agreement, the seller sets the commission rate and how the commission is split. For example, the standard commission rate is 6%. 3% goes to the listing brokerage firm and 3% is offered to the brokerage firm that brings in a buyer. You, as the buyer, have nothing to do with commission.
If you decide to use a discount broker, there's a chance you may receive subpar service. As the old saying goes, "you get what you pay."
2. Leasehold
Before you jump online to check out homes, make sure you understand the difference between fee simple and leasehold. When it comes to leasehold homes: Some buyers will inquire about leasehold properties only if the fee is also for sale. Ideally speaking, it's probably in your best interest to purchase a fee simple unit.
3. Fixer Upper
If you have no experience in renovating a home, it's best you stay away from fixer uppers. Fixing up a home is not for the faint of heart. Depending on what needs to be fixed, renovating a home can be a very stressful process.
If you're looking at a fixer upper home, it's important you bring a contractor with you (or a person who has experienced in remodeling homes).
-RO