House Buying/Selling

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Last Updated: Wednesday, 29 January 2025 16:17
Published: Wednesday, 02 October 2024 22:36
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House Buying/Selling in USA

House Buying in USA is pretty relaxed process compared to buying a house in India. From start to finish on a house ready to move in,  you can move into the house in < 21 days. On a house that is going to be started on a new lot, it may take anywhere from 3 months to a year. House selling is equally easy. Let's explore the process.

Real Estate sites:

There are lots of real estate websites to start looking at houses. Few of the biggest ones that you start your search from are www.realtor.com, www.redfin.com, www.zillow.com, etc. They all have the same info, only difference is in the way they allow you to filter houses.

New houses vs used houses:

You should start the house search on your own. Look at the areas where you want to live, and the prices in that neighborhood. If the area is till developing, you may see new houses on sale too. My preference is to always buy a new house. 3 things in life that you never want to get used => Cars, Houses and Spouses !!

Reasons on why you should always buy a new house if possible:

  • New homes come stress free. Everything in the house is covered for a year (some cover for 2-3 years too). No matter what breaks, Builder will have it fixed for free.
  • You get a better price with new houses. Old houses are sold by people who are looking to make a profit. No one lists their houses to be sold for a loss. However, builders are willing to take a loss on a new house, especially if it' sitting on the market for quite some time. Their goal is to make cummulative profit. Even if they sell few houses at a loss or breakeven, it doesn't matter to them. Many times you will find "spec" houses, which are houses that the builder already built and is ready to move in. He doesn't have a buyer for it yet. In a down market, such houses sell for lower than market price. Everyday such a "spec" home sits on the market, builder has to pay for all the property taxes, utilities, maintenance, insurance, etc. So, it's in his best interest to sell the house asap.
  • First few houses in any new community being built are sold at lower prices than the houses which sell later. So, buy a house in a comunity which is just getting started. Builders will rarely reduce prices of houses selling later, as they don't want to ire previous homeowners who already bought houses in that community for a higher price.
  • Insurance rates on a new house are about couple of hundred dollars cheaper than on a used house.
  • Most realtor agents will give you a better cashback on a newer home than on a new home. See next section.

Agents:

The agent landscape is very competitive where there are more real estate agents than the number of houses that sell in a year. That means each agent is able to sell just 1 house on avg in one year. So, you can negotiate for cashback from these agents. Listing agent usually gets 6% commission on selling the house. The seller pays the commission, so buyer never sees the expense. However if the buyer also has an agent, then the selling agent splits the commission equally, resulting in 3% for each. Most of the times, buyer's agent will give 2%-2.5% cashback to the buyer, and keep 1%-0.5% to himself. This money can be put into the closing costs or can just be cashed out. There is no tax implication for this, as it's a rebate on the purchase.

Below realtor offers 2.5% on a new house and 2% on a used house. She's pretty reliable with rebate. Definitely inquire her and also shop around to see if you can get more cashback.

Link => https://texashomes2percentrebate.com/