Insider Tips for Home Buyers and Sellers

Some 5 million homes are expected to change hands this year, according to the National Association of Realtors. That’s up about 30 percent since the depths of the recession. If you’re thinking of buying or selling a home, Consumer Reports’ survey of real estate agents gives you insider tips on how to negotiate the best deal.

The survey of more than 300 agents reveals that 86 percent say they’ve seen other agents engage in poor business practices. At the top of the list: steering buyers toward a home that would result in higher commissions. And 27 percent say they’ve seen other agents convince a client to sell a home for less than it’s worth.

Consumer Reports says don’t hire the first agent you meet. Interview at least three, and check references. Also find out whether they are members of the National Association of Realtors. Its members have to adhere to a strict code of ethics.

And if you’re selling a house, don’t overpay the agent’s commission. The survey finds that more than 60 percent are willing to negotiate at least half the time. A lot of people think 6 percent is the standard commission, but more than half of the real estate agents surveyed said they usually charge around 4 percent.

For homebuyers, a caution: A third of the agents surveyed said that buyers get into trouble by underestimating what it costs to buy and own a home. It’s not just about your monthly mortgage payment. When you’re buying a home, you have to think about paying an attorney, your closing costs, and the title search. And then there are the ongoing costs of home ownership, such as taxes and utilities.

Another mistake that buyers make is waiting too long to review their credit reports. To get the most favorable rate on a loan, you need a strong credit score of at least 740, according to the chief financial analyst for Bankrate.com. If you need to improve your profile, Consumer Reports says don’t wait until the last minute.

And a final word to the wise: Don’t skip the home inspection. More than a quarter of agents say that not getting an inspection can be one of the more costly mistakes.

More advice on maximizing your deal whether you are buying or selling a house is available at ConsumerReports.org.

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