Barbara Corcoran: Find Your Foundation
Entertainment Barbara Corcoran, investor on ABC’s hit show Shark Tank, explains how to navigate the murky waters of real estate.
Mediaplanet: What do you think are the most important things to consider when buying a new home?
Barbara Corcoran: Buy a sunny home. When the market is good, sunny homes sell first; and when the market is bad, sunny homes still sell.
Make sure there is something about the home that you love. If it’s not a love affair, you won’t truly get comfortable owning it. The smartest investment is the worst home on the best block. Check out your neighbors. Always go back and visit the house and the neighborhood on a Friday night; and check out the parents' school drop-off to get a sense of whether you’ll be happy living there.
Never skip the home inspection. It will cost about $500 — depending on the size of the home and its location — but can save you thousands in repairs.
MP: There are many things to keep in mind when you decide to put your house on the market. What do you find are some of the top tactics when beginning the process of selling your home?
BC: Home buyers today start their search online, so make sure your home wins the beauty contest.
Hire a professional photographer — typically $200 to $400 — or rent a 35mm Digital SLR and good lighting — $100 to $300. Photograph the rooms, the yard, the front and back of your home from its most flattering angles.
"Make sure there is something about the home that you love! If it’s not a love affair, you won’t truly get comfortable owning it."
Buyers decide in the first eight seconds whether or not they want to buy your home, so make those seconds count. Drive up to your house, get out of the car and pay attention to what you see. Fix everything that needs fixing and spruce up everything else.
Remove personal objects like family photos and children’s artwork. Store half your belongings, including knick-knacks and furniture. People can’t visualize themselves living in a home when they can’t see past your clutter.
After location, light is the second most quoted reason a buyer chooses a house, so let the sun shine in! Clean all of your windows, replace drapery with sheer curtains or white shades, trim back shrubs that block window light and put higher-watt bulbs in all the light fixtures.
MP: With mortgage rates now at the lowest in decades, many feel that there is no better time to buy than right now. What can first time buyers and those looking to refinance gain from the current market?
BC: You can get a 30-year fixed rate mortgage for around 4.32 percent and a 15-year fixed rate for about 3.4 percent, but you’ll need a credit score of 740 or higher to qualify for those great rates. Use a mortgage broker to help you shop around and plow through the paperwork. If you want to refinance, start with your current lender and you’ll have a better chance of reducing closing costs.
Know what all the fees, points and closing costs are. Your lender must provide you with a good faith estimate within three days of your loan application. Scan it carefully and ask questions about anything that’s not clear.
MP: What do you find are some of the biggest mistakes people make when looking for a new home?
BC: Visiting the house only once. Revisiting at rush hour allows you to learn about the neighborhood.
Forgetting about how easy – or not – the house will be to resell. The houses that sell the best in every town are the ones in the middle of the price range. Avoiding a house that’s been sitting on the market. It’s often the best deal to be had! Falling in love with the décor. The location and the layout are much more important. Not checking out the local schools. Good schools ensure future real estate value. Low-balling a well-priced property.
MP: When buying or selling a home, what advice can you give to those looking to upgrade and improve their home’s value?
BC: Put your money into the projects that will give you the best return. The improvements that give you the biggest bang for your buck are new decks and patios, larger windows and kitchen and bathroom updates. It never makes sense to convert a bedroom into an office; and don’t add a swimming pool. If every house in your neighborhood has one, it might make sense. If not, buyers inevitably see your pool as a liability instead of an asset.