Ten Questions Home Sellers Don’t Want You to Ask
Home buying and selling season has officially begun, so I wanted to share the ten questions home sellers don't want you to ask. You probably won't get to ask them yourself, so your agent will have to do the sleuthing. In fact, if the seller's real estate agent is any good, she'll make sure that you never come face-to-face with the seller. Agents almost always have their sellers leave the property during showings so that they won't hover over prospective buyers, but also so they don't reveal information that would help the buyer negotiate a better price. While you may never meet a home seller face-to-face, these are important to keep in mind throughout the whole house hunting process.
There is a lot of information that is not on the listing. Yes, Trulia has all the important facts and your agent can pull up all kinds of information about the house, the owner, the taxes, the current mortgage, etc. But there are some things that you just need to ask. Every property has some little quirks that the seller hopes you don't discover. Some are minor. Others could cost you big bucks down the line. In a perfect world, owners would fess up and tell all when they fill out the property condition disclosure statements that most states require.
I am a huge proponent of disclosing everything and being completely honest when selling a house. Unfortunately, not all sellers operate under these same standards.
Ten Questions Home Sellers Don't Want You to Ask
Why are you selling? People have lots of reasons for selling. What you want to know is, how anxious are they to sell? This is a great question to ask simply because it's good to hear it directly from the sellers. Or if that's not possible, the "filtered" answer from their agent will have to do.
How much do you owe on this house? This is a big one. If the house has gone down in value since they purchased it, which is very often the case in today's market, you need to know how much the sellers owe, to know the minimum amount they must sell it for. This will give you a good idea of how much or how little wiggle room the seller has to negotiate. He may be at his breakeven mark right now and cannot drop the price any lower without getting approval from the bank. Most sellers also have a fixed number in their head of how much they would need to walk away without owing any money. You most likely won't be able to offer less than that number. If they don't owe a lot on the house and have some equity in it, you are in luck. They may have more flexibility to come down in price, giving you more negotiating room.
What did you pay and how long have you owned the house? People love to brag about what a good investment they've made or complain about how much value their home has lost in the past few years. If their home has gone up in value, they're excited about it. They feel smart. While it's not smart to tell you, they just might. Also, the homeowner who has owned his house for many years likely has built up considerable equity by paying off his mortgage and gaining some appreciation. These sellers may be a bit more flexible in taking a slightly lower offer. However, if the sellers purchased their home anytime between 2005 and 2009, chances are, that house has lost value. They are not happy about it and, whatever their reasons for selling, they are already very frustrated at having to sell at a loss. The sellers are already losing money and will push very hard not to lose any more.
If it is bank owned, how long has the property been vacant? This is important information to have, because it will give you a very good idea of the condition of the house. If it has been sitting empty for more than thirty days, there is a good chance it has not been maintained properly. The systems may be in disrepair, maintenance may have been deferred, and items from the house may actually be missing or damaged.
How do you like the neighborhood? Unless there is gang graffiti on a burned-out house next door, the homeowners will tell you it's a nice neighborhood. But this question opens the door for you to query further about barking dogs, loud neighbors, kids repairing cars in the street, etc. Hopefully, they will be honest and give you a realistic picture of the neighborhood's character.
How old is the roof? This can be a tough one to get answered. A cagey seller may say, "I'm not sure; I just know it doesn't leak." The correct follow-up is, "In the time you have owned the house, have you put on a new roof?" And if not, then ask if they have a contact number for the former owner. If they have owned the house more than fifteen years, you are getting close to needing a replacement. Most composite shingle roofs have a fifteen- to twenty-year life span. Tile or slate roofs last much longer. You would eventually find all this out in an inspection, but if you can find out now you may save yourself an expense. A new roof is a big cost, and if money is tight after having scraped together your down payment and closing costs, you may not want to be hit with a $6,000 to $10,000 repair bill during your first year in the house. You may need to keep shopping.
When was the last time the furnace or heating system was cleaned and serviced? The correct answer is "Once a season." What it tells you beyond the obvious state of the furnace is the kind of attention the seller has given to overall upkeep of the house and systems.
What is your deadline to sell? If the sellers are on a timetable, it can work to your advantage. They may want a short closing or a long one. They may want to sell the house because they need the money, but need to stay because of work or the school calendar. Or, conversely, they may prefer a long escrow in order to avoid taxes by hitting a certain date. Knowing that can be a powerful negotiating tool.
What's the one thing you won't miss about this house? This is an open-ended question that can prompt the owners to share something they shouldn't. Asked casually, it can yield a piece of the truth that you can use to your advantage, either as a negotiating tool or as a basis for walking away.
The Seller's Bottom Line: What Would You Take If I Gave You All Cash? Okay, unless you're swimming in cash, you aren't going to be able to make an all-cash offer. But by asking this question, your agent can learn a lot about the seller's flexibility and maybe even find out his or her bottom line. If the answer is "The asking price" followed by "Take it or leave it," then the seller is obviously not motivated.
I always ask my agent to "have a chat" with the selling broker prior to making an offer. Realtors will often resist this because it's extra work for them and sometimes a bother, but trust me, it can save you thousands! Insist that your argent have a nice conversation with the seller's agent to find out as much as he can about the house's market history, the ten questions listed above, and what kinds of deal points the seller will respond to favorably. Your agent should then close the conversation with, "So, if I can get my buyer to write an offer, what do you think will get your seller to accept?"
As there is no written offer on the table, a selling agent is under fewer obligations of privacy and may reveal quite a bit more information than he or she can once an offer is on paper. You can now customize your offer. This is like having the answers to a test! You have just eliminated at least one round of offers and counteroffers, and you are guaranteed not to offer more than is necessary, possibly saving you tens of thousands.
-Michael
Michael Corbett is Trulia's real estate and lifestyle expert. He is also the host of EXTRA's Mansions and Millionaires on NBC. In addition to his regular segments on ABC's The View and Fox News, he is a national best selling author with three critically acclaimed real estate books:Find It, Fix It, FLIP IT!; Ready, Set, SOLD! and Before You BUY! His years of experience in buying, renovating, and selling homes have made him a sought-after nationally recognized real estate expert.
