I am a huge advocate for home ownership. In fact, my goal for this article is to empower you to seek home ownership wisely and build wealth through real estate. If you are in the market for your first or fifth home–this advice from a professional Real Estate Consultant, Alexandra Sardegna, will help you buy a home.
Acquania from The Purpose of Money: Thank you for joining me for this interview. I am excited about our readers hearing your tips for buying a home. But first, can you tell our readers more about yourself?
Alex Sardegna of Century 21 Redwood Realty: I am a Real Estate Consultant with Century 21 Redwood Realty. I am officially based out of our Washington, D.C. office, but I am licensed in Washington D.C., Maryland, and Virginia. I have 10 years of experience in real estate. My specialties include working with first-time home buyers, folks relocating to the Washington, D.C. area, and investors.
I also have extensive experience with staging and listing properties for sale. Prior to getting into real estate, I spent nine years as a committee staffer on Capitol Hill. This experience enabled me to develop strong negotiation skills. I also gained a deep understanding of the concepts of representation and advocacy.
PoM: Alex, your extensive experience must be very helpful for your clients. However, I want to clarify something for our readers. In real estate, you constantly hear some people refer to themselves as a Realtor and others as a real estate agent. What is the difference between a Realtor and a real estate agent?
Alex Sardegna: A real estate agent is someone who is licensed to sell real estate in a given jurisdiction. The term “Realtor” is actually trademarked by the National Association of Realtors (NAR). So an agent can only use that title if they are an official member of NAR. Generally speaking, most agents are also Realtors. But all agents must abide by Federal Fair Housing guidelines, fiduciary responsibilities, and other laws that govern our practices.
I personally prefer to use the title of “Real Estate Consultant” because I believe it’s more reflective of my overall approach to the business and my responsibilities to my clients.
PoM: Thanks for that clarification. Alex, what do you recommend first time home buyers do before they start looking for a home?
Alex Sardegna: The first step that any prospective buyer should take is to consult with a mortgage lender and a real estate agent. Generally, I will recommend consulting with at least a couple of lenders and agents in order to find the best fit for you. On the lender front, it is imperative for buyers to know where they stand in terms of their finances and spending power. On the agent front, you should be able to sit down for a comprehensive discussion about your needs, goals, and plans. Your agent can then help you determine how you can achieve these objectives. The most important thing is for you as a buyer to feel comfortable with whomever you are working with. Buying a home is the biggest purchase you may make in your life!
PoM: Alex, I understand you try to make the home buying process special for your clients. Please explain to our readers what happens in a first consultation with you? What kind of services do you offer your clients?
Alex Sardegna: The initial Buyer Consultation is key in laying the groundwork for your home search. My approach is to gather information in order to understand what is most important to my clients. It could be location, features of the home, or finding something that can be rented because you are going to be deployed in a few years. Everyone has different situations and life plans so listening to and processing what you need and want, is my first priority.
Then, together we go over whatever you know about your budget and spending limit. With this information, I target the areas, neighborhoods, and types of properties that are the closest fit to what you’re looking for. My goal is to be there for buyers every step of the way and to provide that same consultative approach throughout the entire process. I empower buyers with knowledge so you can make informed decisions as we move forward with your home search and purchase.
PoM: If someone has a limited budget but lives in a high priced market, what do you recommend they do to afford home ownership?
Alex Sardegna: I believe home ownership is almost always attainable, it just depends on what your goals are. High-priced markets like the Washington, D.C. area can present challenges, but part of my role is to help folks understand those challenges. In some cases, that may involve shifting the goalpost a little bit, whether it be location, size, or condition of the property.
Considering properties that are livable but may need updating, is one way to give folks more options in tougher markets. Ultimately though, it always comes down to lining up your needs and wants with what is available in any given area at your target price point.
Sometimes it makes more sense for you to wait until you’ve saved more money, raised your credit score, or taken other measures to improve your spending power. Those are the types of things that would usually be addressed in the initial consultation. In those cases, I would help you determine the best game plan to get on track for buying a home in the future.
Related Reading: How to Raise Your Credit Score & Have Debt
PoM: Budgeting and knowing how much house you can afford is so important. What else should someone look for in their first home? What home features give buyers the most bang for their buck?
Alex Sardegna: There are two parts to this question: what buyers may need for themselves and then what is going to help resale value in the future.
Generally speaking, cosmetic and expansion improvements can always be made to a property in the future (updating kitchens/bathrooms, flooring, windows, even adding a half bath). So you don’t need to make resale value an initial priority, especially if you’re buying a home where you want to live long term. Conversely, there are some things that can’t be changed, like being on a busy or major road or in a basement or terrace level of a condo. Those are factors to keep in mind that can affect potential appreciation. Condo properties also have their own challenges in this regard, such as being a walk-up, not having a washer or dryer in the unit, or being poorly run or poorly maintained by their association.
At the same time, there are some things that will generally help retain and sometimes increase a property’s value. For example, if you can afford an extra bedroom or bathroom, garage or covered parking, or a house that’s situated on a more even (rather than sloped) lot–those will always be good items to seek at your home. Being located within a relatively close distance to a current or planned public transportation station is also generally a smart choice when considering things that will help your property appreciate.
The bottom line is that each buyer will need to weigh all of these factors and figure out what’s most important at the time of purchase. And then I can help you figure out how to best reconcile your needs with factors that will appreciate the value of your home.
PoM: So many search engines exist to help you do your own home search. Should home buyers trust the home values and estimated mortgage prices on search engines like Zillow?
Alex Sardegna: Consumer sites and search engines are notorious for their lag times in getting updates from the Multiple Listing Services (MLS), a system that feeds all listing information to consumer websites. These sites are also known for inaccuracy of their home valuations, among other issues. Their valuations are based on algorithms that use local sales data to generate prices, but they don’t take into account important factors like the condition of properties or where or how a property is situated.
These websites use square footage, number of bedrooms and bathrooms, and other basic information that in most cases will not reflect an apples-to-apples comparison to a nearby property. These estimates are fine as baselines, but they should be taken with a grain of salt. Broker websites or the National Association of Realtors’ website are going to be your best bet in terms of accuracy of listing status and property information.
Ultimately, the best way to get the most accurate valuation of your home is to consult with a realtor. For my clients selling a home, I prepare a Comparative Market Analysis. These reports are comprehensive examinations of recently sold, under contract, and similar properties currently for sale, then compared with the seller’s property. Based on these snapshots of the current market, I tell the seller the approximate value of their home.
Mortgage calculators are different, however. They operate on a straightforward formula, but they are also subject to rate fluctuations, property taxes for a given area, and condo or home association fees. Some mortgage calculators account for these items, but others do not. That’s a big reason why it is so important to consult with a reputable mortgage lender.
PoM: What qualities should someone look for in a realtor or real estate agent?
Alex Sardegna: The most important thing is for buyers–especially first-time home buyers–is to feel comfortable and confident about the person they are working with to find their home. Feeling listened to, communicated with, understood, and supported are paramount for buyers.
The agent that helped me buy my first home was fantastic and has remained my model for how to be a good real estate agent. She didn’t pressure me, was patient, and listened to my feedback. She also told me that I would know when I found “the one,” and she was exactly right. A no-pressure and a consultative approach from someone who knows the local market well, is always going to be what buyers should look for in a real estate agent.
PoM: So there you have it. Great tips for buying your first home and looking for your perfect real estate agent. In the comments please share more home buying tips for the PoM community. If you want to connect with Alex you can find her on her website, Facebook, and LinkedIn.