Simple Tips On Buying A Home In A Competitive Market

Dated: 03/30/2018

Views: 650


In case you haven't noticed it's a whole new market out there in the real estate world.  It's a robust seller's market that is happening now and buyers have to realize that the days of waiting to make an offer on a  home that lingers on the  market for months is over.  So too are the days of offering thousands of dollars under asking price.  Since most homes are selling inside of 3 weeks (even lower in some markets), a buyer that sees a home that is in their budget and wants to buy it, holding out may cost you your "Dream House".


National Association of Realtors's February 2018 report states that close to 2/3 of home prices in the housing market at at an all time high.  So if you are interested in buying a home this year you will definitely want to read the list below before going to see homes with your Realtor and prepare yourself for some real competition.........


(1)  Associate yourself with a Realtor that you trust - Your Realtor should be a good teacher and provide you with all the information you need to properly educate you on the buying process, should know the local market where you are buying.  They should be responsive and reachable, a great Realtor should play devil's advocate for you.  For example: "This will likely happen if you do that".  Not all Realtors are comfortable being Mr. Nice Guy which could end up costing you your "Dream House".  You should remember that this is "Business" and the Realtor with a not so warm and fuzzy approach might be the one to get you across the finish line and to the closing table.  Remember, this is not match.com so choose wisely, you may not end up being the best of friends but a good Realtor will be the go to person that you call over and over again for sound advice.


(2)  Get the Down Payment together - This means that you have saved and have a nice nest egg in your account for at least for two months.  Banks need to see the funds for at least 60 days sitting in your account in order to count those funds as a part of your down payment.  Closing costs are included in your nest egg.  Your earnest money deposit should be large as this makes the offer stronger to the seller.  Sellers see a large deposit  as a serious purchaser.   You may want to place 2 deposits, one up front and then a second when the home passes all inspections.  This trick in a seller's market will help in keeping you safe and competitive.


(3)  Have yourself Approved - I can't stress this enough to buyers.  You should absolutely be approved before you begin looking at home with your Realtor.  This shows the seller that a lender has actually combed through your credit and actually given you a thumbs up on what you can really afford on the home you want to purchase.  You will be in the front of the line to the seller of the house you are placing an offer on with your "Approval".


(4)  Contingencies are a no-o to sellers - Any contingencies presented in your offer will lower your appeal to sellers.  Let's say you have a contingency with the need to sell your home first in order to purchase the home chances are that the seller will not want to wait for your house to sell.  A strong clean offer will more likely win out over an offer loaded with contingencies.


(5) Pay attention to the "Net Price" - The "Net Price" in a competitive seller's market is all that matters to the seller.  Where supply is low in desirable area, the bottom line is the "BOTTOM LINE".  Asking for a seller's assist can cost you an offer acceptance, make sure your offer gives the seller an offer that is close to their asking price.

 

(6)  Search for a Diamond in the Rough - Once you have found your ideal neighborhood find the house that needs the most updating.  It may take a little time to make the home right for you but with a little work & love you will end a winner because you bought low and with your improvements you now have built in equity.  Read up and do your research on which improvements provide the best returns on investment, knowing this will keep you from investing too much on any one project.

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