Your real estate questions, answered: What everyone should know whether you’re buying, selling, or staying put

Real estate is always happening, whether you're actively in the market or not. Rates are fluctuating, home values are adjusting, and everyone, from renters to investors to long-time homeowners are being affected, even when they don't realize it.

A home is, for most people, their biggest financial asset, so understanding how it behaves in any market, at any life stage, ensures that you're always in the strongest possible position.

As a long-time real estate journalist, I've seen, heard and read it all when it comes to real estate. I've also learned how to take complex real estate concepts and simplify them.

If you've been Googling for real estate info and gotten either a sales pitch or a too-complicated, inside baseball answer, you're in luck, because I'm here to break it all down for you and get your real estate questions answered.

Your real estate questions answered: If you’re thinking about buying

What credit score do I need to buy a home?

Most conventional loans require a minimum score of 620, but a score of 740 or higher typically unlocks the best interest rates and lowest monthly payments. Some loans, like those backed by the FHA or VA, allow for even lower credit scores, which can vary by state and lender.

It's worth shopping around and talking to at least three lenders when you're applying for a mortgage. Even a half-point rate difference affects a monthly payment more than most buyers expect.

On a $300,000 loan, the difference between a 6.5 percent and 7 percent interest rate is about $97 per month — $1,610 vs. $1,707 in principal and interest. Over 30 years, that half-point costs you roughly $34,920 in additional interest.

That's why pushing your credit score from, say, 680 to 740 before you apply isn't just a technicality. Lenders tier their best rates to borrowers above certain score thresholds, and the savings can be substantial over the life of a loan.

If your score is low, explore FHA options, credit repair and other strategies to push it a bit higher. Note: Lenders generally pull scores from all three bureaus and, typically, use the middle score.

How much do I actually need for a down payment?

Contrary to popular belief, you do not need 20 percent down to buy a home. Conventional loans allow as little as 3 percent, FHA loans require 3.5 percent, and VA and USDA loans are available with zero down for qualifying buyers.

If you're putting down less than 20 percent, you'll often have to pay for private mortgage insurance (PMI), which can cost anywhere from 0.5 percent to 1.5 percent of your loan amount annually. It's designed to protect your lender (not you) in the event that you stop making payments on your home loan.

Once you reach 20 percent equity, you can refinance your loan or, in some cases, request cancellation of your PMI policy. If you invest in improving a fixer-upper, or if you buy in a desirable market that's growing in value, you may reach 20 percent equity more quickly than you expect. In that case, it's worth getting a new appraisal and talking to your lender about PMI cancellation.

If you don't have much money saved for a down payment, explore down payment options from lenders or from online platforms like DownPaymentResource.com.

What’s the difference between pre-qualification and pre-approval?

Pre-qualification is an informal estimate based on self-reported information. Pre-approval is a verified commitment from a lender based on documented income, assets, and credit — and it’s what sellers take seriously.

Pre-qualification allows you to get a tentative idea of how much home you can afford, but you'll probably need a pre-approval to actually go home-shopping. Pre-approvals typically last 60-90 days, so keep an eye on the calendar while you're shopping and don't take out any new loans or open any new credit cards while you're looking.

You'll need W-2 forms, tax returns for the past couple of years, pay stubs and bank statements to apply for pre-approval. If you're self-employed or have additional sources of income like alimony or investment dividends, you'll need proof of that as well.

How long does it take to buy a home from start to close?

Once you’re under contract, closing typically takes 45–60 days. The full process — from starting your search to getting keys — often takes 3–6 months depending on the market and your financing.

Pre-approval → Active search → Offer accepted → Inspection → Appraisal → Final loan approval → Close

Some factors that can extend that timeline include financing complexity, inspection negotiations and appraisal gaps (where the home's appraised value comes in less than the amount you're seeking to finance).

What costs should I expect beyond the down payment?

Plan for closing costs of 2–5 percent of the loan amount in addition to your down payment. On a $300,000 home, that’s $6,000–15,000 in additional upfront costs.

Items included in your homebuying cost include:

• Closing costs: lender fees, title insurance, attorney fees, recording fees

• Inspection: $300–600 typically

• Appraisal: $400–700

• Moving costs (highly variable depending on volume and distance)

• Initial maintenance reserves — A good rule of thumb is 1 percent of home value per year

Your real estate questions answered: If you’re thinking about selling

How do I know when it’s the right time to sell?

There is no single right time, but there is a right framework: consider your equity position, your local market’s inventory levels, your life circumstances and the current rate environment together — not any one factor alone.

For example, a homeowners with 40 percent-plus equity in a low inventory market is in a strong position, even when rates are elevated or the market is slow.

Job relocation, family changes, downsizing needs and other life events can override market conditions, In that case, you'll need to take a realistic look at market conditions and timeline to determine to determine what tradeoffs you're willing to make — and which ones you aren't.

Selling in a slower market may mean pricing aggressively or accepting a lower offer. But for many sellers, the cost of waiting is higher than the cost of moving on.

How is my home’s value determined?

Your home’s market value is determined by recent sales of comparable properties in your area — not by what you paid, what you need or what online tools estimate.

Comps are determined by:

• property size

• property condition

• community location

• features and upgrades

on homes sold within the past three to six months. Comparable pricing is based on the final sale price, not the list price of comparable properties.

Online and AI-generated estimates provide a starting point, not an appraisal, and they can be way off from actual comparables. Take them with a grain of salt when guesstimating your home's potential value.

What should I do — and not do — before listing?

Focus on high-ROI preparation: neutral paint, deep cleaning, curb appeal and decluttering consistently outperform expensive renovations in terms of return.

Do:

• Fresh paint in neutral tones (highest ROI of any prep)

• Deep cleaning, including carpets and windows

• Landscaping and front door refresh

• Declutter and depersonalize every room

Don’t:

• Over-improve based on your personal taste (buyers want to make it their own)

• Skip a pre-listing inspection — surprises during buyer’s inspection kill deals

• Price based on what you need rather than what the market supports

Do I have to pay a commission, and how does it work now?

Commission is negotiable and always has been. Following the 2024 NAR settlement, the structure is now more transparent: sellers negotiate compensation with their listing agent, and buyers negotiate with their own agent separately, since buyer's agent compensation is no longer automatically offered through the MLS.

Sellers can still choose to offer buyer's agent compensation as a negotiating tool. Alternatively, you can wait for buyer to request agent compensation as part of their offer package.

If you're interviewing and evaluating multiple agents, look beyond their commission rate when making your choice. A listing agent who charges a minimal commission may cost you more in the long run.

Pricing strategy, negotiation skill, marketing reach, and the ability to keep a deal together through inspection and appraisal are worth far more than a percentage point of commission savings — especially in a market where small missteps can mean a lower offer or a failed closing.

What happens between accepting an offer and closing?

The period between accepted offer and closing — typically 45–60 days — is active, not passive. Sellers should expect inspection negotiations, an appraisal and ongoing communication with their agent.

Here are the activities you can expect during the contract or escrow period:

• Inspection period: buyer orders inspection; seller responds to repair requests

• Appraisal: lender orders to confirm that property value supports the loan

• Buyer’s final loan approval: underwriting can request additional documentation, which can delay this stage

• Title search: confirms clear ownership

• Closing day: sign documents, transfer keys, receive proceeds

Your real estate question answered: If you own a home and aren’t going anywhere (yet)

How do I know how much equity I have?

Your home equity is your home’s estimated current value minus your remaining mortgage balance. If your home is worth $400,000 and you owe $250,000, your equity is $150,000.

Tracking home equity matters, even if you're not selling. It can impact your decisions around refinancing and financial planning, as well as providing options for financing education, travel or home improvements.

Should I refinance, and how do I know?

Refinancing makes sense when the savings on your refinanced monthly payment exceed the cost of refinancing, and when you’re likely to stay in the home long enough to recoup closing costs.

• Step 1: Estimate refinancing costs (typically $2,000–5,000)

• Step 2: Calculate monthly savings at the new rate

• Step 3: Divide costs by monthly savings = break-even in months

If you plan to stay in your current home longer than the break-even point, refinancing likely makes sense.

What home maintenance actually protects my investment?

The maintenance that protects home value most is the kind that prevents expensive failures: HVAC servicing, roof inspections, gutter cleaning, caulking and moisture management. Small annual costs prevent large emergency expenses.

• Annual or seasonal HVAC service ($150-$300) vs. system replacement ($8,000–15,000)

• Gutter cleaning to prevent foundation and fascia damage

• Roof inspection every 3–5 years (catches issues before they become leaks)

• Caulking around windows and doors to prevent moisture intrusion

When should I start thinking about selling, even if I don’t want to yet?

The best time to start thinking about selling is 12–18 months before you think you’ll need to. That runway lets you prepare the home strategically, understand current market conditions and avoid reactive decisions.

It may be a good time to start thinking about a home sale if ...

• You’ve built significant equity and your life circumstances are shifting

• Your neighborhood’s home values are changing — in either direction

• You’re within five years of a major life event (retirement, empty nest, job change)

• You’ve stopped thinking of the home as a long-term fit

Note: Talking to a real estate agent early in the process is information-gathering, not a commitment. The best agents will give you an honest read on timing, value and preparation without pressuring you to list.

Real estate isn’t something to only think about when you’re in the middle of a transaction. Whether you’re buying, selling, or simply living your life in a home that you own, understanding how the market works puts you in a better position to make decisions on your own timeline.

Questions I didn't cover? Let me know at christy@writingrealestate.com.