Real Estate - Dallas/Ft. Worth, TX

1. Tax breaks. The U.S. Tax Code lets you deduct the interest you pay on your mortgage, property taxes you pay, as well as some of the costs involved in buying your home.

2. Gains. Over last five years (1998-2002) national home prices have increased at an average of 5.4 percent annually. And while there's no guarantee of appreciation, a 2001 study by the National Association of REALTORS found that the typical homeowner has approximately $50,000 of unrealized gain in a home.

3. Equity. Money paid for rent is money that you'll never see again, but mortgage payments let you build equity ownership interest in your home. If you are renting, you are essentially paying your Landlord’s mortgage. Why not put that toward your own mortgage instead?

4. Savings. Building equity in your home is a ready-made savings plan. And when you sell, you can generally take up to $250,000 ($500,000 for a married couple) as gain without owing any federal income tax.

5. Predictability. Unlike rent, your mortgage payments don't go up over the years so your housing costs may actually decline as you own the home longer. However, keep in mind that property taxes and insurance costs will rise.

6. Freedom. The home is yours. You can decorate any way you want and be able to benefit from your investment for as long as you own the home.

7. Stability. Remaining in one neighborhood for several years gives you a chance to participate in community activities, lets you and your family establish lasting friendships, and offers your children the benefit of educational continuity.

To calculate whether renting or buying is the best financial option for you, use this calculator courtesy of Ginnie Mae. www.ginniemae.gov/ypth/rent_vs_buy/Rent_vs_buy.htm

A real estate transaction is complicated and has it's own language. In most cases, buying or selling a home requires disclosure forms, inspection reports, mortgage documents, insurance policies, deeds, and multi-page government-mandated settlement statements. If you don't know a CMA from a HUD-1, you can understand why it's important to work with someone who speaks that language. A knowledgeable guide through this complexity can help you avoid delays or costly mistakes. Most people buy and sell only a few homes in a lifetime, usually with quite a few years in between each purchase. Even if you've done it before, laws and regulations change. That's why having an expert on your side is critical.

Make sure the agent you choose has got the experience necessary to represent you well in the buying or selling process. Choose a REALTOR® who has been in business for a while and one who has a proven track record for the results you desire. Find out how many houses they have been involved in on either the buying or selling side. Ask for references of past buyers and sellers that were pleased with their services to ensure you that they are experienced.

Most states have mandated that real estate agents are "responsible" to their clients. They have a duty, called a "fiduciary duty." This means real estate agents not only have to sell the house, they have to be responsible to act in the best interests of their client. That involves a lot of liability, which is one reason for all the disclosures and the pages and pages of contracts, and why they want to be paid for being more than "just" a salesman. The listing contract will specify that your agent is acting as a "seller’s agent." This means that, in the sale of your house, they are working for you and only you -- and looking out for your best interests. However, there may be times when your listing agent has a client who wants to buy your home. For that reason, there is a little "wiggle room" in the listing contract. If your agent also represents the buyer, the listing contract should specify that they provide an additional disclosure that details whether they continue to act as your agent or assume the duties of a dual agent.

When someone decides it is time to sell their home, they interview several REALTORS® from different companies to determine which one is best for them. They want someone who will represent them and someone they feel will do an effective job at marketing their home. However, when someone decides to buy a home, they usually end up with their REALTOR® through sheer accident. Why don’t home buyers search for a REALTOR® the same way that home sellers do?

Today, the listing agent represents the seller, and the buyer's agent represents the buyer. Buyers have a choice! Sellers still pay the commission but it is paid to the brokerage of the listing agent. That brokerage in turn pays a portion of the received commission to the brokerage of the Buyer's agent.

If you call on a single classified advertisement in a newspaper, an ad in one of those homes selling magazines, or a listing on the internet, you are most likely calling the listing agent. For argument's sake, suppose that you call the REALTOR® who is listing the property you "might" be interested in. It turns out that the house is absolutely perfect and affordable and you want to make an offer. Do you want the same agent who represents the seller to also represent you? When you make an offer to buy a house, you are entering a negotiation. The seller wants as high a price as possible and the buyer wants the lowest price possible. Plus, there is more to buying a house than just settling on a price. If a REALTOR® represents both sides, there is a potential conflict of interest, although an ethical REALTOR® can often equally represent both sides. Most real estate transactions go fine, but almost every one has a challenge or two. These challenges are often routine but sometimes not. Because the agent has divided loyalties, one side or another may doubt where those loyalties truly lie. Mistrust develops. This can take a small problem and blow it way out of proportion. At that point it becomes a crisis. Having an agent on your side as your advocate removes the mistrust and helps keep things on an even keel. If a challenge develops, you know where your agent stands. Plus, the seller pays for it -- you don't.

All that said, your first step should be to shop for a REALTOR®, not to shop for property. Shop for a REALTOR® the way you would shop for a good attorney, accountant, mechanic, plumber, doctor, financial advisor, or other professional. Start by asking friends, co-workers, neighbors or family if they know of someone they can recommend. Now that we have the Internet, you have more information at your fingertips than buyers from the past. The web is another good place to search. There are lots of directories that list agents, plus search engines, too. Most competent, full time REALTORS® have websites and are well versed in the use of basic technology. If not, you may want to consider the current qualifications of that agent. The ability to communicate quickly and efficiently with clients, other agents and a host of other parties involved in a real estate transaction is vital! This can sometimes mean the difference between getting your dream home or being beat out by another buyer whose agent was quicker acting.