• Sun. Jun 26th, 2022

Some Of The Worst Real Estate Advice Parents Give Their Kids

UGANDA, Kampala | Real Muloodi News | Buying real estate is one of life’s major milestones. Therefore, turning to your parents for advice may seem like a natural, logical step when making such a big decision. However, just because they’re your parents, it doesn’t mean they’re always right. Realtors share some of the worst real estate advice they have heard well-intentioned parents giving to their adult-children over the past year — and why you may just want to turn to the professionals.

Bad Advice #1: We Don’t Like It

Sometimes your parents are going to loathe what you’re buying. Mum hates the bathroom. Or Dad thinks the compound isn’t good enough. Whatever the reasons are – they don’t like the house.

Property agent Sam Massoudi had a client who missed out on a condo that he had his heart set on because his parents advised him the unit was ‘not in good enough shape’. In fact, the unit was fairly newly built by a reputable developer. However, the it had been rented out to a tenant who left scuff marks on the walls.

“I tried explaining to my client and his parents that they must see through that,” says Massoudi. “It was a small one-bedroom so painting wouldn’t cost much, especially if it meant securing a place that checked all the boxes.”

Unfortunately, due to parental pressure, his client ended up bypassing that unit. This ended up being worst real estate advice because the next condo he settled on cost a lot more. While he saved on the cost of painting, he spent millions more shillings on the price difference between the condos.

Bad Advice #2: Put in Low-Ball Offers

Some parents will tell their children to put in ridiculously cheap bids, or what are known as ‘low-ball’ offers; an offer that is less than fair market value for the property and far below the price the seller is asking for – and often times far below the price the buyer is actually willing to pay.

However, putting in low-ball offers in hopes that someone will eventually accept it can end up backfiring. If you are perceived to be acting in bad faith, the seller may not want to entertain any subsequent offers from you, and you may end up walking away empty-handed.

“Parents who tell their kids to use this strategy are not understanding how competitive this market is,” says realtor Jenelle Tremblett, who notes there are other buyers coming in right behind you who will gladly pay fair market value for the property. Instead, she advises, “Follow the lead of your realtor as they know the pulse of competition, and can properly advise if low-balling is even worth your time.”

Bad Advice #3: You Don’t Need a Professional Inspection

While you may trust your parents’ judgment, there are a lot of things a professional home inspection can reveal about a property that are not visible to the naked eye. Be sure to hire a professional who’s been in the business a while and knows what to look for to inspect your property before you buy it. Inspections should cover electrical safety, structural condition, and roof condition. Buying a home without a professional inspection is some of the worst real estate advice that can really cost you in the long term.

It is also essential to open the boundaries of a plot before buying it or to at least carry out a preliminary survey for untitled land. Always use a registered surveyor of the Surveyors Registration Board (SRB) to do this, since these are the only ones permitted by the Surveyors Registration Act to sign survey reports.

Bad Advice #4: Look for Your ‘Forever’ Home

Some parents will pressure their adult children to look for their ‘forever’ home, and avoid the annoyances of moving again. However, your first home doesn’t have to be the home you retire in.

In places like Kampala, this advice is not even realistic where property values are already so expensive.

Instead, many agents will advise first-time homebuyers to begin in a modest home they can comfortably afford. Over the next several years, you can save on the rent you were paying, while gathering some equity in your home, before moving on to another property that is better suited to your next life stage.

Bad Advice #5: Use the Listing Agent or Broker to Represent You

The listing agent or broker that is selling the property on behalf of the owner obviously is representing the best interests of the seller. But according to Tremblett, she actually had a parent tell their home-hunting child to use that same broker as a way to save money.

This is obviously the worst real estate advice possible. The listing agent’s interest is to negotiate as much money out of the buyer as possible, in an effort to represent the seller well and earn repeat business.

“The seller’s agent represents the seller, so they don’t owe you anything in the negotiations,” Tremblett explains. “Everyone deserves their own representation, which is why you need to get someone in your corner if you don’t want to overpay.”

It’s not uncommon for parents to still want to be involved in every step of their child’s home-buying journey; they want to protect their kids, even though they are adults. Sometimes parents are also contributing some money or co-signing on the mortgages, so they may feel they have final say. However, while parents want the best for their kids, you may want to have a professional agent on your team also.

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