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Don’t Fall into the Shark Tank: Helpful Hints for House Hunting

Mar 31, 2016 3 min read

Key Takeaways

  • Dealing with sharks? Don't show your cards.
  • A fixer-upper in a great neighborhood beats a beauty in a bad locale.
  • Too much noise? Trust your instincts.

 

While most of us may not be looking to audition for Shark Tank in hopes of our startup business idea taking off, the “sharks’” lessons can be valuable when venturing out on the path to homeownership. Here’s how.

 

 

Never swim scared

Sharks — both the fish and the business gurus — can smell blood in the water. It’s the sense of desperation that is written all over a rookie entrepreneur’s face when they take the stage. This never, ever helps the business owner’s case.

The same applies to home sellers. While it’s very difficult to hide your excitement or your dismay, it’s best to take a neutral approach when a seller asks your thoughts on a home.

Why? Because hiding your emotions gives you leverage. If you’re cool, calm and collected, it can save you thousands because you haven’t given up your bargaining chips.

 

One (wo)man’s trash is another (wo)man’s treasure

If you find a home that you simply “have to” see, but your realtor (or even perhaps your partner) is less-than-thrilled, try to go see it anyway. Besides the fact that the average home buyer visits ten homes before buying1 — more is better — you might just find a hidden gem. Some buyers are amazing visionaries, while others won’t make an offer based on minor eyesores like carpet and paint (aka easy and cheap fixes).

If you love the neighborhood, the commute makes sense, and the community feels right, take a look and consider fixing up the blemishes. Buying the neighborhood eyesore can pay off big-time by using sweat equity to gain immediate equity in your home. Better to buy the fixer-upper in a great neighborhood than the gleaming beauty in a decent community.

Not all prospective buyers will agree on the value of a home, just as the sharks have disagreed on the profitability of budding new businesses. Take a look at the 12 Biggest Shark Tank Success Stories to see which sharks were laughing last.

 

Opinions are important, but not the end-all

Opinions are a dime a dozen, some more important than others. While the entrepreneurs on Shark Tank didn’t end up in the hot seat based on sheer luck, there were times they were wrong. Did you see this Multi-Million Dollar Product That Got Away?

There will also be people in your life who will have big opinions on your pending new home purchase. While it might be tempting to be swayed by those with more experience and with the loudest voice, you must first listen to your instincts. Why? It is your commute, your yard to take care of, your mortgage to pay, and most of all — the place you will be calling home. Just because you are a rookie homebuyer doesn’t mean you don’t know what you want, so educate yourself, politely thank those who love you for their opinions, then choose the best home for you.

 

Value is in the eye of the beholder

And the inspector. Valuing your home can often be the hardest part. Even the sharks have trouble agreeing on reasonable offers for contestants, and they are seasoned businessmen and women.

There's a reason that 97% of homebuyers2 believe that getting a home inspection was a good value for the price that they paid: it gives you peace of mind and a potential bargaining tool if the inspection is less-than-perfect. At that point, you can choose to walk away from the property (which is advisable if the home has major problems like structural issues, mold, etc.), or you can choose to negotiate downward on price. Either way, it’s a win-win and helps validate if your offer was on-target or too high.

 

What you can do next

Buying a home can be like an episode of Shark Tank. If you steel yourself emotionally — and prepare with the knowledge to make sound decisions — you can score a sweet deal on a place that'll be all yours.


Sources:

1. http://www.realtor.org/news-releases/2014/11/nar-annual-survey-reveals-notable-decline-in-first-time-buyers
2. http://www.homeinspector.org/NAR-ASHI-2001-Home-Inspection-Study-Executive-Summary

Prudential Financial (Retirement) is not responsible for the information contained in the external website(s) and makes no representations about information contained therein. The site(s) is/are provided to you for informational purposes only. This article has been provided for informational purposes only. It should not be considered a recommendation of any product or service for which you should consult your qualified professional

 

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