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Ben Bacal and Aaron Kirman attend the Haute Residence Los Angeles Luxury Real Estate Summit 2016
Photo by Tommaso Boddi/Getty Images for Haute Living
You might have seen Los Angeles-based realtor Aaron Kirman of the Aaron Kirman Group (AKG) at Christie’s International Real Estate on NBC’s “Listing Impossible.” Or seen his name in print, as his team frequently lists celebrity homes (clients reportedly have included Rihanna, Justin Bieber, Jennifer Lopez and Nicki Minaj, as well as royals from Qatar, Saudi Arabia and Kuwait). Or just heard his name around town: Annually, he and his team sell more than $400,000,000 of real estate, according to real estate news outlet The Real Deal. So we decided to ask Kirman: Even if a buyer doesn’t have a ton of loot to drop on a home right now, what should they know about the market? Here’s what he told us.
If you’re planning to buy a home, even if it’s not a mega-mansion, Kirman, 44, says it’s important to consider interest rates (see the best mortgage rates you may get now here), inventory and housing prices — as well as these 4 things.
1. Go deep into the comps
“Comps are readily available and fully transparent. Active or pending sales don’t dictate the market, actual sale prices do, so you should be hyper-focused on sales prices in your research,” says Kirman.
When looking at comps, realtors suggest taking the neighborhood, square footage, features and amenities into consideration to make sure you are making as much of an apples-to-apples comparison as you possibly can.
See the best mortgage rates you may get now here.
2. Try to take the emotion out of the purchase
This may be easier said than done, especially if you form an attachment to a home after you’ve toured it and fallen in love with it. “I realize homes can be an emotional purchase because it’s where we live, but at the end of the day, everybody wants to make a sound financial decision. It’s crucial that your decisions are based on good economic sense that will be good for your financial future,” says Kirman.
Pros say that once you’ve submitted an offer, make sure the house checks out during inspections and don’t talk yourself into overlooking minor issues, especially if they’ll cost a significant amount of money to fix. Know your spending limit, draw a line and try to wait until after the home is officially yours before you really fall in love with it.
3. Do your diligence on potential real estate agents
“[This person should be] an adviser you trust and respect. They should be looking out for your best interest and not their own,” says Kirman. Said another way, the realtor you’re working with shouldn’t be showing you properties you can’t afford or those that may close in their favor, unless they’re financially sound for you.
Consider interviewing at least three realtors to get a sense of what each can offer you. And don’t be afraid to ask questions during the interview process about what your relationship with them will look like, what their familiarity with the area is like and what their buying and selling process is like.
4. It’s very hard to time the market
“There’s really not a right or wrong time to buy as we’re not smart enough to time the market, so buy when your finances are in place and the time is right for you,” says Kirman.
That said, this market has made it tough for many to buy. “Many first-time buyers will likely be on the sidelines until interest rates and housing prices begin to calm down. However, as we head into spring, I do believe housing prices will begin to level off,” says Kirman.
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