Smart Home Buying

Thursday, January 31, 2008

As a Stanford Business School Alumnus and a Real Estate Broker, over the years Stanford invited me to give seminars to the graduating students on home buying strategies.  After all, many of the Stanford Graduate School of Business graduates land high paying jobs and are anxious to buy their first home.

These students are trained to think analytically and like checklists.  So do I.  This summary is pulled from my seminar archives on “Smart Home Buying”. 

Don’t

• Buy without a really good real estate agent
• Ask everybody for his or her opinion
• Buy during hot markets (i.e. spring)
• Get involved in crazy multiple offers
• Buy a home with foundation problems
• Buy a home with “major unfixable negatives”
• Do significant remodeling while living there
• Over analyze
• Think of your home as just an investment
• Expect perfection

Do

• Use a really good local real estate agent
• Have your cash and loan approval in place
• Go online to educate yourself
• Go to open houses to educate yourself
• Buy properties that have been on the market for a long time
• Buy when others aren’t
• “Go for it” if a home “comes close” to your needs
• Buy the best location you can afford
• Have thorough inspections
• Multiply remodeling cost estimates by 1.5X
• Multiply remodeling time estimates by 2X
• Plan on a minimum of 3-5 years for net profit