Home-Buying Game Has Changed. Here's How To Win
This winter is shaping up to be a seller's market, with low real estate inventory, high prices, and bidding wars that could give buyers a major run for their money.
This doesn't mean you should throw in the towel—just that you'll have to hone your house hunt in new ways to suit the times. Here are some tactics that will keep you ahead of the pack so you'll be sitting in a new home by the new year.
Secure your financing as soon as possible
Getting pre-approved for a mortgage and securing financing are an essential first step when buying a home. It gives you a clear picture of how much house you can afford, and lets you make an offer as soon as you find your dream home.
Too often, buyers don’t line up their financing until they find a home they want to buy. In the current competitive market, waiting to get pre-approval means you could lose out on purchasing a home you love.
That creates a mad dash and stress to get everything lined up under pressure. Get all your financing secured and ready before you look, that way when you find the right home you're 100% ready.”
Starting early could also help you lock in an ultralow interest rate, which could affect your monthly mortgage payment and mean you could afford a more expensive home. As of Oct. 22, Freddie Mac listed rates at 2.8% for a 30-year fixed-rate loan.
Know what you want before you house hunt . COVID-19 has changed how we live and work. We’re spending much more time at home, and people are looking for different features in their living spaces.
Make a list of your must-haves before you start house shopping—and share your needs with your real estate agent.
Don't dawdle if you want to make an offer. In September, there were nearly 40% fewer homes on the market than during the same month last year, according to a realtor.com report. At the same time, buyer demand has increased, creating an incredibly competitive marketplace.
Homes were on the market for an average of 54 days in September, 12 fewer days than last year.
Make your offer stand out.
Since inventory is so low, sellers are getting multiple offers on their homes these days. To make sure yours gets accepted, you’ll need to make it stand out.
Cash offers and inspection waivers are some ways to make your offer more appealing.
A cash offer, if you can afford it, is attractive to sellers because it eliminates dealing with a mortgage lender and often speeds up closings. An inspection waiver comes with lots of risks, since you’re essentially agreeing to purchase a home as is, but the waiver removes any repair negotiations and helps you close faster.
For competitive markets, where you know you’ll be competing directly with many buyers, talk to your agent about escalation clauses. This is a contract addendum where you agree to pay more than other offers (up to a maximum you set).
Bottom line: Find a strategy to help make your offer stand out over all the other offers that may come in on your dream home.
If I can help you with your home buying or selling needs, give me a call. I promise to make it the best experience possible.