Livermore Home Buying Webinar 8.8. 2013Presentation Transcript
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Home Buying 101
August 8, 2013
Presented By: Sonal Basu
Redfin’s Livermore - PleasantonTeam
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A Little Bit About Who We Are
● Redfin is a real estate brokerage that has helped over
20,000 people buy or sell a home; 97% would refer us to a
● Customers, not commissions
● Informed decisions
● The right home for the right price
● No obligation
● Get back a portion of our commission
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Understanding the Buying
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Are You Ready to Buy?
● Do you have a family and need room to grow?
● Do you expect to stay put for 5 or more years?
● Have you saved up a down payment?
● Can you rent for less?
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Overview of a Purchase
Real Estate Agents
Consider your needs
Draft Offer Docs
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20 City Composite
Case-Shiller: San Francisco Area v. 20-City
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Where to find data…
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This occurs when inventory is down and buyer interest is up
5 Tips for Winning in a Bidding War
1. Make the competition eat your dust
2. Get pre-approved with a local lender & get underwriter
3. Start the conversation early
4. Write a letter & appeal to the seller
5. Know your limits
Multiple Offer Situations
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National Market Trends
The March key metrics across 19 major metropolitan markets:
● Home sales rose 25% from February, but were barely up
from 2012, rising just 0.9% year-over-year, the smallest gain
in 14 months.
● The number of homes for sale declined 31% from March
2012 to March 2013 (a slight improvement over the 32%
drop in February), and were flat month over month.
● Home prices in March increased 15% year over year, and
rose 6% just since February.
● The percentage of listings that were under contract within
14 days of their debut inched up yet again from 33.2% in
February to 34.8% in March, the highest point on record.
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National Market Trends
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What Happens After You Find
a Home You Love?
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What to Ask Any Agent
● Is this your full-time job?
● Familiar with foreclosures or short-sales?
● Where were your last five deals?
● Who else will be working with me?
● Will you show me all properties for sale?
● When am I committed to working with you?
● Has a client ever filed a complaint?
● How are you paid?
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Traditional vs. Redfin
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Redfin’s Partner Program
Partner agents are employed by other
brokerages, but have teamed up with us to provide
Redfin-Certified service to a wider range of
We’ll refer you to a partner agent when:
► A home is outside of our direct service area
► A home is below our price minimum
► We’re experiencing an unusually high customer demand
We survey all partner agent clients
► All surveys are published on their Redfin page
► 97% of customers would recommend Redfin partners
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● Redfin Certified Providers
● Every professional is reviewed and all reviews are shown
● Search for local:
► Title Companies
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We List Homes, Too!
● More people see your home
► Premium placement on Redfin.com
► Mobile apps target on-the-go buyers
► Professional flyers
● You’ll know it all at every step
► Email all buyers who see your home
► See how many people have viewed your home
► Advise you at every step in the process
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A pre-approval letter is a letter from a bank or a lender estimating
how much they'll lend you
● Establishes what you can afford & makes offer process go faster
● Good for 90 days, depending on lender
● Ask for a few different amounts
● Redfin asks that you get pre-approved before your third tour
● Similar, yet different from pre-qualification
● W-2, two pay-stubs, tax returns, bank statements
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Organize Your Assets
● Get ready for the down payment
● Cash accounts (liquid funds)
● 401k, stocks, other investments
● Gift funds? (max. allowed varies)
● Move funds around early
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Review Your Debt
● Pull credit report, look for errors
● Figure out how much monthly income goes towards debt:
28 – 33% healthy
● Pay down credit balances to 1/3rd
● Don’t open any new lines of credit
● Don’t buy any big ticket items
● Co-borrower will need to do the same
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Start Shopping for Lenders
Compile a list of 3-4 lenders & brokers
Good sources include:
● Redfin's partner lenders
● Referrals from friends, family & co-workers
● Banks or credit unions you have accounts at
● A large, national bank with an advertised rate
● Your real estate agent
● Online review sites, such as Yelp
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Comparing Loan Estimates
● Gather loan estimates
► A minimum of three, more is better
► These aren’t final numbers, but within a few thousand
► Compare similar loans
Program (FHA, conventional)
Timeframe (same day)
● Compare costs side-by-side
► Discount & origination points
► Interest rates
► Insurance premiums (FHA, PMI)
► APR (interest rates + fees + points + PMI)
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Current Average Rates
Type of Loan August 1, 2013 July 25, 2013
30-Year Fixed 4.39% 4.31%
15-Year Fixed 3.43% 3.39%
5/1 ARM 3.18% 3.16%
1-Year ARM 2.64% 2.65%
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Make Your Decision
● When possible, get a loan commitment
● Make alternative funds liquid (401k, stock)
Good news! Loan payments are made in arrears, so your first
loan payment won’t be for two months.
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• Check out our agents and their reviews
• Study the inventory and houses in your areas
• Go out on Tour with us, no obligation
• Ask a lot of questions and see a lot of houses
• Email me: firstname.lastname@example.org
• Check the events page for upcoming classes
• Go back to work!