Q & A: All About Buying
 What are the advantages of using a Real
Estate Specialist to help me buy a home?
What are the advantages of using a Real
Estate Specialist to help me buy a home?
Buying a home is certainly one of the most
rewarding experiences most of us ever have; it’s also one of the most challenging. If
you’re buying for the first time, the process may seem overwhelming. And even if
you’ve been through it several times, every move is different, and presents new
challenges.
So one clear advantage of enlisting the help of a Real Estate
Specialist is simply that you don’t have to "do it alone." A good Real
Estate Specialist has the training, the know-how, and the experience to help you through
each step of the process, and make the process of finding, buying, and moving into your
new home as smooth, quick, and enjoyable as it can be. Another advantage is that a Real
Estate Specialist represents a valuable source of information about market trends,
communities, neighbourhoods and especially, homes for sale throughout the area. A Real
Estate Specialist is therefore able to offer you access to complete, regularly updated
information about every home listed daily. ERA Real Estate Specialists receive information
on new listings daily through the ERA internet website, the ERA Mobile Access Network
computer system and the ERA Pager Listing Network.
A final advantage is that, all of these services usually come at no
cost to you. This is because almost all Real Estate Specialists involved in a given
transaction work for the seller, and thus would be paid through the commission on the sale
of the home by the seller. The exception however, is in HDB/HUDC transactions where the
market practice is for the buyer to pay a 1% commission. As you will observe in the
following questions, a Real Estate Specialist’s expertise and efforts can indeed be
of considerable help throughout the buying process.
Where do I begin the process of looking for a home?
The first thing you should do is to start focusing on what you’re
looking for in a home. You can start by establishing priorities in the following three areas:
Location: Are you relocating
to a new housing/residential area because of a new job, or to be closer to your current
job? How will the location of schools, amenities and transportation affect your choice of
neighbourhoods?
Personal tastes: How large a
home do you need? Do you prefer a condominium with full facilities or would you and your
family be happier with a landed property?
Budget: Would a private property be a financial burden, or would a HDB/HUDC apartment be more suitable for your
budget?
As you consider these areas, do a little research of your own. Look
through magazines for ideas about home styles and features. Drive through neighbourhoods
that appeal to you to see what’s available. Go through the real estate listings in
the newspapers and TCS Teletext - ERA Property Online to learn about current prices in the
areas that you’re considering. Talk to friends about the features that you’d
really like to have in your home. The more knowledgeable you become, the better your final
decision is likely to be.
Then sit down and consider carefully all the things you’re looking
for in a home. The Homebuyer’s Wish List worksheet is a good starting point. When
you’ve filled it out, you’ll begin to get a good idea of what you’d like
your dream home to be.
How do I find the
right Real Estate Specialist to work with?
The key word here is "right". It’s important that you
find a qualified Real Estate Specialist who can fully understand your wants, needs and
individual tastes, and whose personal and professional judgement you respect.
That’s why we suggest you talk to several different Real Estate
Specialists before choosing one. We’ve included a few guidelines on about the kind of
experience and service capabilities you should be looking for. Above all, look for someone
who makes you feel comfortable. You may wish to sign a buyer's exclusive service agreement
to engage the service of a specialist.
How do I know for sure which home I can afford?
We’ve found that affordability is probably the single biggest
concern of today’s first-time home buyers. Given the wide range of media coverage
regularly devoted to the issue, it’s not surprising that many young families wonder
how long it will take them to afford their first home.
Our advice: Don’t sell yourself short. Talk to a Real Estate
Specialist. A good Real Estate Specialist is committed to honestly and responsibly working
with you to determine your affordable price range. There are many financing options
available today, and some include low downpayments. The Real Estate Specialist will help
find an option that fits your budget, and you may be surprised at just how much you can
afford.
If you are considering buying a HDB flat, make sure the Real Estate
Specialist works out the financing plan for you. The amount of cash you need to pay will
vary with your age, income, CPF savings, the prevailing interest rate, price and valuation
of the flat.
How does buying compare to renting?
Renting offers a lifestyle that’s nearly maintenance-free. That
may appeal to you, but considering that renting offers you no equity, no tax benefit, and
most likely no protection against regular rent increases.
If your rent has averaged $2,000 a month for the last 10 years,
you’ve spent $240,000 with nothing to show for it. Considering that your home would
also have appreciated in value over the same period, isn’t it time you invested in
yourself instead of your landlord?
What should I think about when I am deciding
which neighbourhood I want to live in?
Good amenities, nice parks, recreational facilities, convenient
shopping and transportation – these are just a few considerations that are important
to many people when they choose a community in which to live. And there is no better
source of information than your Real Estate Specialist.
Real Estate Specialists know the people and the communities they serve,
and chances are they can help you find a neighbourhood that really fits your family’s
needs.
Where can I get information about the
neighbourhood schools?
Again, a good Real Estate Specialist is perhaps your best source. He
will know where the neighbourhood schools are, and can provide you with valuable
information about these schools including their rankings, extracurricular activities, bus
services and more. He may even be able to put you in touch with teachers and principals
when you visit the area.
How can I find out what homes are selling for in
a given neighbourhood?
An easy way is to ask your Real Estate Specialist. If you’re
interested in a particular home, a Real Estate Specialist may be able to provide you with
a list of comparables, sale prices of homes in your area that are roughly the same size
and age as the home you’re considering. Although there will certainly be some
differences between the homes — the house next door may have been extensively
renovated, or the one across the road may be older than the one you’re looking at
– it’s a good way to evaluate the seller’s asking price.
How can I find out what my property tax bill will
be?
Simply ask to see the seller’s latest property tax bill or you can
also do a search at the Inland Revenue Authority of Singapore. Alternatively, check with a
Real Estate Specialist with access to the computerised Valuation List search system in the
Internet.
When I start visiting homes, what should I be
looking for the first time through?
The house you ultimately choose to call home will play a major role in
your family’s life. A home can be an excellent investment but more importantly, it
should fit the way you really live, with spaces and features that appeal to everyone in
the family.
As you look at each home, pay closer attention to these important
considerations:
• Is there enough room for you now and in the near future?
• Is the home’s floor plan right for your family?
• Is there enough storage space?
• Will you have to replace any fixtures and fittings?
• Will you have to do any major renovation?
• Are there enough bathrooms?
• How much maintenance and/or decoration will you need to do right
away? Later?
• Will your present furniture fit in this home?
• Do you like the orientation of the home?
• Are there any water seepage problems?
How many bedrooms should I be considering?
Whether you are married or have kids, spare bedrooms come in handy when
family and friends come by to stay. And when you’re not having guests, extra rooms
are useful as a study or TV room.
Another good reason to choose a home with extra bedrooms: Extra space
will make your home more appealing to a larger number of interested buyers when it comes
to selling time.
Is an older home as good a value as a new home?
It’s a matter of personal preference. Both new and older homes
offer distinct advantages, depending upon your unique taste and lifestyle.
With the combined problems of land scarcity and population growth,
today’s homes are usually built on smaller plots, unlike most homes built years ago,
which offer more living space. The emphasis for older homes was on the interior layout
unlike new homes, which focus more on external design. For instance, a new condominium
comes in a smaller living unit averaging 1,100 sq ft as compared to an older unit which
offers as much as 1,600 sq ft.
As for HDB flats, the older ones are generally cheaper and are normally
well-supported by established amenities than flats in newer localities.
What do I need to bring along when I am
viewing homes?
Bring your own notebook and pen for note-taking and measuring tape for
checking room sizes, clearance, etc, if floor plans are not available.
Be prepared to "snoop around" a little. After all, you want
to know as much as possible about the home you buy. Sellers understand that because their
home is on the market, it will be looked over pretty thoroughly.
If you need to go back to a home for another look, your Real Estate
Specialist will be happy to schedule an appointment. Also, be sure to ask any questions
you have about the home, even if you feel you’re being nosy. Remember – you have
the right to know!
What should I ask about each home that I view?
As a general rule of thumb, ask any questions you have about specific
rooms, features, or functions. Pay particular attention to areas that you feel could
become "problem" areas – additions, defects, areas that have been repaired.
And above all, if you don’t feel your question has been answered satisfactorily, ask
until you do understand and are satisfied. Ask also about any announced changes in the
neighbourhood such as road widening, new developments, amenities or facilities that are
being planned for the locality.
In most cases, your Real Estate Specialist will be able to provide you
with information about each home you see. In addition, you can use the Home Features
Worksheet to help you evaluate each home.
 What should I tell my Real Estate Specialist about the homes I
view?
Tell your Real Estate Specialist everything you liked and didn’t
like about each home you view. Don’t be shy in talking about a home’s
shortcomings. Is the home too small for your needs? Let your Real Estate Specialist know.
Was the home perfect except for the floor finishes? Let your Real Estate Specialist know
that, too. The more open and descriptive you are, the easier it will be for your Real
Estate Specialist to find the home you’ll love.
How many homes should I view before I buy?
There is no set number of homes you should view before you decide to
make an offer on one. That’s why providing your Real Estate Specialist with as many
details as possible upfront is so helpful. The perfect home may be waiting for you on your
first visit. Even if it isn’t, the house-hunting process will help you get a feel of
the homes in the neighbourhood and narrow your choices to a few homes that are worth a
second look.
How do I know whether I am getting the best value
for my money?
In most cases, a valuation is the best way to tell if a home is priced
fairly. It’s an unbiased opinion of a property’s value based on its age,
location, size, design and other factors. The transacted prices and asking prices of
comparable properties nearby are used as a guide to determine its value.
When you apply for a mortgage loan, the lender will have a professional
real estate valuer perform a valuation of the property.
As for HDB properties, you may want to consult a Real Estate Specialist
who is from a reputable real estate company with a high HDB transaction volume. The Real
Estate Specialist is usually able to provide you with a free Comparative Market Analysis
(CMA) report.
Do I need to use a lawyer to buy a home?
Yes, for private properties. It is a requirement to work with a lawyer
because the legal contracts and other paperwork involved in buying a home are complex, and
can be confusing to the general public. Your lawyer will review contracts, make you aware
of special considerations and potential problems, and help make everything go as smoothly
as possible. If you don’t know a real estate lawyer, ask your Real Estate Specialist
for help.
As for HDB properties, generally you need not engage a private lawyer
unless the transaction is complicated by separation, divorce, death, use of power of
attorney or other related problems.
When I have found the home I like, how do
I make an offer?
When you’ve found a special house you want to call home,
you’ll probably feel excited and a bit nervous. Your Real Estate Specialist is ready
to help you through this important period.
With your Real Estate Specialist, you’ll write an "Option to
Purchase" (OTP) – a written document that declares how much you will pay for the
home provided that certain conditions are met.
Your offer should have a time limit for the seller to accept, reject,
or make a counter-offer. If a counter-offer is made, you will have some time to consider
and respond.
For HDB properties, buyers and sellers will have to submit the resale
application to HDB after the Option to Purchase (OTP) has been exercised.
How do I determine the amount of my
initial offer?
There is really no hard and fast rule in calculating a realistic offer.
Naturally, the buyer wants the best value and the seller wants the best price but
negotiations can be influenced by many factors, such as a seller who may be changing jobs
and wants to sell quickly, or a buyer who really wants a specific home.
After you’ve looked at the home’s features, asked questions,
checked comparables, and talked about it with your Real Estate Specialist, you should have
a good idea of what the home’s value is in the current market. Consider what you can
afford, and make an offer that you consider fair.
Most buyers and sellers negotiate on price, with both sides
"giving" a little until both agree. When the price is agreed upon, the paperwork
should be signed by both parties.
What is "option money" and how much do
I need?
When you sign an Offer to Purchase (OTP), your Real Estate Specialist
will ask you for option money – that is, money that shows you are serious about
wanting to buy. Usually, you will be asked to write a cheque of 1% of the sale price for
private properties and an amount not more than $1,000 for HDB resale flats.
If your offer is accepted, your option money will be included as part
of your downpayment. If your offer is not accepted, you’ll get back all your option
money. However, should you back out, you will forfeit the full amount of your option
money.
Is there any way I can protect myself against
emergency repair bills in my new home?
Yes. The ERA Home Warranty Plan offers you protection against many
potentially costly problems not covered by your homeowner’s insurance. The coverage
can save you thousands of dollars in the event of a major mechanical breakdown, at a time
when your cash reserves have been depleted by your deposit or downpayment.
There is so much to remember before I close a
deal to buy. What do I have to do?
Your Real Estate Specialist can help you with many of the following
items:
• Are all the necessary inspections complete?
• Are all the required repairs complete?
• When will you conduct your final walk-through inspection?
• Is your lawyer satisfied that title to the property is clear,
i.e. no one else has a claim on it?
• Have you confirmed a completion date and time for you and your
lawyer?
• Are all the necessary documents completed?
• Have the property tax and service and conservancy charges been
paid up to the date of completion
What should I look for in my final
walk-through inspection?
In most cases, you’ll be given the opportunity to inspect the home
prior to completion. At this time, it’s important to check on any work the seller
agreed to have done in response to your initial inspection. You should also carefully
check the condition of walls and ceilings from which window treatments, pictures, or any
other attached furnishings have been removed. If you find any problems, don’t
hesitate to bring them up prior to your completion. It’s the seller’s
responsibility to correct them.
What will happen on completion day?
For private properties: Both the
seller’s and your lawyers would have pre-arranged all the necessary documents. They
will swap all these documents and the necessary payments for the keys and title deeds of
the house.
For HDB properties:The
seller is to produce up-to-date official receipts for full payment of the service and
conservancy charges and property tax, while you are to produce a valid Certificate of Fire
Insurance. Both you and the seller will then execute the legal documents respectively and
the seller will hand over the keys to you.
Is there anything I should do immediately after closing?
The first thing you’ll want to do is to have the locks changed. Also, put your
deed and other important paperwork from the completion in a secure place, preferably a
safe deposit box. It’s smart to know where your copies are and have access to them at
all times. |
