How to Use the Internet to Shop Your New Home

Before we offer some insights into the internet as a tool for search and shop a home, we cruised the internet and found some interesting news that may help in yoour consideration your next home.

Mortgage Rate Daily: Rates Remain Relatively Stable. Again Applications were down, decreasing 0.8 percent on a seasonally adjusted basis and 0.6 percent on an unadjusted basis from the previous week. The application volume was up 13.8 percent from the same week in 2006.

Refinancing as a share of all mortgage activity was up to 42.1 percent from 41.8 percent a week earlier while the share of ARMs fell yet again from 18 percent to 17.4 percent.

Associated Press: Wildfire Hotspots Spook Insurance Cos. Spooked by devastating wildfire seasons, the nation's top insurers are inspecting homes in high-risk areas throughout the West and threatening to cancel coverage if owners don't clear brush or take other precautions.

The inspections have angered homeowners and watchdog groups that accuse the companies of trying to cut risk at the expense of customers, even while industry profits soar.
The requirements can range from clearing brush to cutting down trees or even installing a fireproof roof.

Real Estate Journal: Product Taps Home Equity Without Taking Out Loan.
By James R. Hagerty
A small San Francisco investment company, backed by a subsidiary of insurer American International Group Inc., is rolling out a product that lets homeowners tap into their home equity without moving or taking out a loan.

The company, REX & Co., offers to pay homeowners cash now in exchange for a right to part of the proceeds when the home eventually is sold.
www.realestatejournal.com/buysell/mortgages/20070511-hagerty.html

The owner of a home valued at $750,000 might obtain $100,000 in cash by giving REX a 50% share of the change in the home's value. If the home sold for $850,000, REX would receive $150,000 -- the original $100,000 invested plus half of the increase in value. If the home sold for $650,000, REX's share would be $50,000, half of what it had invested

Washington Post: The services of a buyer's broker don't come free, even though buyers aren't asked to take pen to checkbook to pay for them. The good news is there are a growing number of local real estate agents offering to work with buyers for less in the form of rebates.
"Maybe the agent is new or inexperienced and needs the business," Odio-Páez says on his Web site. "Maybe the firm is virtual and can't open homes up for you, so you'll have to do it yourself. But when you focus on getting a rebate, you will always be giving something else up." He also warns: "Not negotiating the best deal could also cost you much more than you'll save by getting a rebate."

How to Use the Internet to Shop and Search Your New Home

According to NAR, which has a vested interest in following this new trend very carefully, 9 of 10 home buyers still use a real estate agent in the traditional way. However NAR, goes on to note that in 1995 only 2% of buyers used the net to search for a home but by 2005 that figure jumped to 77% and has most certainly increased since then. This is not necessarily bad news for the broker/agent. It actually provides a lot of information now including photos, maps demographics and all kinds of helpful information to a buyer.There is so much choice now for a new home buyer to search easily that it has been a boon to the industry as well as the consumer.

However, when the internet delivers information freely to the consumer, that was previously in the hands of the professional, the edge that the professional has is diminished and the commissions soon begin to drop. The 6% standard commission, we believe, is being challenged and that all buyers and sellers can now get a better deal. That commission has always been negotiable and the timing has never been better for the consumer to get a better deal.

For example discount realtor's such as Zip Realty will offer services for 4%. That is quite a savings and there are new business models challenging even the discount brokers. Redfin is an internet web site that is offering to rebate back to the buyer 2/3's of the commission. Normally, the 6% commission is split between the buyer and seller's agents. Redfin will keep just 1% of that commission for transacting the house and they will even find you a loan.

If the old adage holds true that you get what you pay for, are they really the good deal they appear to be? We don't think there is one answer for all people here, some people will be very happy with the service and others will not have a good experience. Either way, its clear that the internet is providing new choices for the consumer.

How to Shop Online

1. MLS. Its the old standard and trustworthy.
2. Trulia.com A new model for home buyers in search
3. realtors.com 4. freddie mac has a listing og homes for sale 5. forsalebyowner.com offers listing for sale without the use of a broker agent. This is a great way to save the commission, but please, only for the very knowledgeable.
6. HUD has a listing of HUD homes for sale
7. craigslist is a community bulletin board that lists homes for sale
8. All banks have a stable of foreclosed homes for sale, often a a great discount. Use a professional here, unless you understand the risks.
9. foreclosure.com is another site with foreclosed homes for sale
10. All the broker houses such as Caldwell Banker, Provident etc. all will provide good search tools to help you find your new home
11. Any individual agent associate web site will offer a listing of homes represented
12. housingmaps.com is another interesting new tool for home buyers and sellers

There is so much now on the internet, just sit back and take the tour.

Some Financing Resources

Veterans Administration home loan program,
Affordable housing at Freddie Mac,
Your Property Path
CICA programs for affordable housing, Housing Assistance Council

Tenant Screening Insurance & Mortgage Services