Purchasing a home you love at a fair price requires diligence and informed decision-making rather than luck. If you’re a first-time homebuyer, doing your homework is essential. Here’s how to ensure you’re getting a good deal:

How to Ensure You’re Getting a Fair Deal on Your New Home

1. Evaluate Comparable Listings

Start by examining multiple properties with similar amenities, room sizes, and square footage. Look at properties within a 10% range of your target property’s size. Use online tools to estimate property values, but also make in-person visits to compare prices and speak directly with sellers. Be cautious of prices that seem unusually high or low, as this could indicate hidden issues.

2. Review Recent Sales and Listings

Investigate the average sale prices of similar properties sold in the past three months. Focus on properties in close proximity and similar in age and condition. Compare listing prices with actual sale prices to understand the negotiation room. Real estate agents often prepare a Comparative Market Analysis (CMA) to provide a fair understanding of current prices. Be wary if a property has been on the market for an extended period, as it could be overpriced.

3. Consider Potential Reasons for Pricing

If a house is significantly underpriced, the owner might be in a hurry to sell or there could be structural issues. Ensure you conduct a thorough inspection if you suspect the latter.

4. Understand Market Value

The market value of a house is a starting point for negotiation, based on CMA, property features, and location. An appraisal value, conducted by a licensed professional, provides a more accurate estimate. Besides online calculators, consider the assessed value used for taxation purposes, which is typically lower than market value. If there’s a significant discrepancy between assessed, appraised, and asking prices, request the seller to justify the higher price.

5. Consult Professional Appraisers

Professional appraisers or property valuers can provide an accurate assessment of a property. Use their reports to negotiate confidently, especially if certain components are overpriced. Key factors include curb appeal, valuation of similar properties, amenities, and home improvements.

6. Gather Data from Multiple Sources

Rely on various sources for information. Use online property valuation tools, compare listings on property portals, and check National Housing Bank Residex data for city-specific housing price indices. Consult multiple real estate agents to understand pricing trends and use your network to gather data on actual sale prices.

7. Assess Added Conveniences

Sometimes, properties are priced higher due to additional amenities like luxurious fixtures, appliances, or air conditioning. Have these components appraised to avoid overpaying. Be cautious if the seller tries to leverage your interest in the property to initiate a bidding war. Evaluate whether the property’s prime location justifies the price despite potentially lacking amenities.

8. Consider Society Management Tools

When discussing convenience, inquire if the housing society uses digital management apps like MyGate. These apps enhance security, facilitate digital maintenance payments, and streamline society management, adding value to the property.

By following these steps, you can ensure you’re making a well-informed decision and securing a fair deal on your new home.