5 Secrets to Buying the Best South Beach House for Your Money

1. Get "Pre-Approved" - Not "Pre-Qualified!"

Do you want to get the best property you can for the least amount of

money? Then make sure you are in the strongest negotiating position

possible. Price is only one element in the negotiations, and not

necessarily the most important one. Often other terms, such as the

strength of the buyer or the length of escrow, are critical to a


In years past, I always recommended that buyers get "pre-qualified" by

a lender. This means that you spend a few minutes on the phone with

a lender who asks you a few questions. Based on the answers, the

lender pronounces you "pre-qualified" and issues a certificate that

you can show to a seller. Sellers are aware that such certificates

are WORTHLESS, and here's why! None of the information has been


Many times unknown problems can come to the surface! Some of the

problems I've seen include recorded judgments, alimony payments due,

glitches on the credit report due to any number of reasons both

accurately and inaccurately, down payments that have not been in the

clients' bank account long enough, etc.

So the way to make the strongest offer today is to get "pre-approved".

This happens AFTER all information has been checked and verified. You

are actually APPROVED for the loan and the only loose end is the

appraisal on the property. This process takes anywhere from a few days

to a few weeks depending on your situation. It's VERY POWERFUL and a

weapon I recommend all my clients have in their negotiating arsenal.

2. Sell Your Property First, Then Buy the House

If you have a house to sell, sell it before selecting a house to buy!

Contingency sales aren't nearly as strong as one that comes in with a

ready, willing and able buyer. Consider this scenario: You've found

the perfect house - now you have to go make an offer to the seller.

You want the seller to reduce the price and wait until you sell your

house. The seller figures that this is a risky deal, since he might

pass up a buyer who DOESN'T have to sell a house while he's waiting

for you. So he says OK, he'll do the contingency but it has to be a

full price offer! You have now paid more for the house than you

could have because of the contingency, and you have to sell your

existing house in a hurry! Otherwise you lose the house! So to sell

quickly you might take an offer that's lower than if you had more

time. The bottom line is that buying before selling might cost you

THOUSANDS of dollars.

If you're concerned that there is not a house on the market for

you, then go on a window-shopping trip. You can identify possible

houses and locations without falling in love with a specific house.

If you feel confident after that then put your house on the market.

Another tactic is to make the sale "subject to seller finding suitable

housing". Adding this phrase to the listing means that WHEN YOU DO

FIND A BUYER, you will have some time to find the new place. If you

don't find anything to your liking, you don't have to sell your

present home.

3. Play the Game of Nines

Before house hunting, make a list of things you want in the new place.

Then make a list of the things you don't want. You can use this list

as a guide to rate each property that you see. The one with the

biggest score wins! This helps avoid confusion and keeps things in

perspective when you're comparing dozens of homes.

When house hunting, keep in mind the difference between "STYLE AND

SUBSTANCE". The SUBSTANCE is the set of things that cannot be changed such as

the location, view, size of lot, noise in the area, school district,

and floor plan. The STYLE represents easily changed surface finishes

like carpet, wallpaper, color, and window coverings. Buy the house

with good SUBSTANCE, because the STYLE can always be changed to match

your tastes. I always recommend that you imagine each house as if it

were vacant.

Consider each house on its underlying merits, not the seller's

decorating skills.

4. Don't Be Pushed Into Any House

Your agent should show you everything available that meets your

requirements. Don't make a decision on a house until you feel that

you've seen enough to pick the best one.

A decade ago, homes were selling quickly, usually a few days after

listing. In that kind of market, agents advised their clients to make

an offer ON THE SPOT if they liked the house. That was good advice at

the time. Today there isn't always this urgency, unless a home is

drastically under priced, and you'll know if it is.

Don't forget to check into the SCHOOL DISTRICTS of the area you're

considering. Information is available on every school; such as class

sizes, % of students that go on to college, SAT scores, etc. You can

get this information from this web site.

5. Stop Calling Ads!

Please note - ads are sometimes created to make the phone ring! Many

of the homes have some drawback that's not mentioned in the ad, such

as traffic noise, power lines, or litigation in the community. What's

not mentioned in the ad is usually more important than what is.

For this reason, I want you to be very careful when reading ads.

Remember that the person writing the ad is representing the seller

and not you! The most important thing you can do is have someone

on your side looking out for your best interests. Your own agent

will critique the property with an eye towards how well it meets your

needs and will point out any drawbacks you should know about. So

whether you decide to work with me or not, pick an agent you feel

comfortable with and enlist the services of that agent as a buyer's

broker. Then you become a client with all the rights, benefits, and

privileges created by this agency relationship, and you're no longer

just a shopper. Did you know that many homes are sold WITHOUT A SIGN

ever going up or an AD EVER BEING PUT IN THE PAPER? These "great

deals" go to those people who are committed to working with one

agent. When an agent hears of a great buy, who do you think he's

going to call? His client, who he has a legal obligation to work

hard for you, or someone who just called on the phone and said

"keep your eyes open"? So to get the best buy on a property, I always

recommend that you hire your own agent and stick with him or her.