Buying a Home in a Seller’s Market

Be patient, find a good realtor and get ready to move fast on a home at a moment’s notice. Sound advice in this crazy seller’s real estate market in America right now. Low interest rates led to historic sales in 2020 and now 2021 has historically low inventory. Sellers are getting dozens of instant offers and buyers have to be ready and will pay more to compete for the home they want.

Patience Is Key: Buyers will most likely be making offers on several homes before their offer is finally accepted. Stay resilient and keep forging forward without getting discouraged. Discipline is necessary for not becoming emotionally invested in any one property that could end up in a bidding war and raising the price. Know what you want and don’t want in a home. Including key features like location, the number of bedrooms, bathrooms, and know if there is anything that would be a dealbreaker.

Knowing what you want, what you can live with, and what you can’t live with will help you quickly narrow down homes during your search. It also means that when you find a home that is perfect, you won’t have to second guess yourself on whether you should move forward.

The Value of a Good Realtor: The resources, experience, and skills of a good Realtor are priceless when it comes to buying this hot seller’s market. Take the process of finding the perfect Realtor seriously, especially in this market. A high-level agent with the most experience and expertise will help you get the home and the deal you want. Take and follow all the advice he/she gives you knowing that their advice, education, and networking skills will be your best advocate in negotiating. If possible, work only with a Realtor who does real estate full time. As a buyer, you can’t wait for a “lunch break” or “after five” to see a property.

Be Ready. Move Fast: These are the days that you can’t wait. If you see a home online or on the MLS, get out and go see it immediately. Waiting a few days with the shortage of inventory out there could cost you. Homes are moving fast and if it’s a home that you think you will love? Run. Be prepared to make a same-day offer. There is also a possibility that you might have to buy a home sight unseen based only on videos and photos.

Get your financing in order, it will give you the advantage. There is strength in a preapproval letter or having proof of funds documentation on hand as well as working closely with a mortgage broker. You will be competing with other buyers and the one with the most bonafide offer will get the house.

Consider Contingencies: One of the biggest reasons a seller rejects an offer is due to the number of contingencies that are in the offer. The more that the buyer has, the greater the chance a transaction does not get completed.

While contingencies are all designed to protect you as a buyer, assuring you’re getting a safe and livable property, they are an extra burden for the seller. It all means a longer sales process, potentail repair costs and even a lost deal. Having an experienced Realtor as your advocate at this point in the process is key in helping you be careful when making a contingent offer.

The Bottom Line: The seller has the upper hand in this chaotic, hot market. Buying a home during a seller’s market is not for everyone.  There are many factors that need to be considered in order to help decide whether it’s a good idea or not.  Again, having a top Realtor is critical. He/She will be able to help you decide whether waiting is a better option and will be looking out for your best interest.

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Get the Edge in a Seller’s Market

A seller’s market is when there are more people buying houses than there are houses for sale.  If you’re looking to buy a home right now, it may be hard to get one at a fair price. In the most sought-after areas, houses are going under contract in a matter of days, even hours. What can you do to be prepared if you must buy a home now?

Hire the best Realtor

Do a search on Realtors. Get the best, with the most experience, you can find. This will give you the advantage you need in a competitive market as she/he will be on the frontlines, keeping you in the know at all times.

Be ready to act instantly

No matter where you live, listings for homes in popular neighborhoods are often few and far between. When these homes do hit the market, they don’t last long. If your heart is set on buying in one of the more popular areas, starting your house hunt early and having patience means that when the moment comes, you’ll need to act quickly.

If you’re really interested in a home, ask your Realtor to get as much info as you can beforehand: property reports, disclosures, etc. Keep your schedule open so that when a home becomes available, you can get to it immediately. .

Get pre-approved

One of the smartest things you can do to ensure your chances of getting the home you want. This part can very well make or break the process. Assume others will be putting in an offer as well and having a pre-approval letter in your hand will give you an edge.

Having your lender verify your ability to afford a home loan for a certain amount lets the seller know you are qualified and motivated. It shows financial security which gives the seller the confidence to feel that the sale will go smoothly with you.

Keep your offer simple

Most offers include contingencies- things like completing inspections and receiving a mortgage commitment -that needs to happen for the transaction to move forward.

When looking at offers, sellers tend to see contingencies as potential opportunities for the deal to fall apart. As a result, they’re more likely to choose an offer that’s relatively “clean” or reduces their risk of potential hang-ups.

In a competitive market, you might see other buyers removing or reducing their contingency periods to make their offer more competitive.

But remember! If you choose to, for example, waive an inspection contingency, you’re agreeing to buy the home regardless of what problems may exist. You’ve got to be OK with that.

Start with a strong sale price

Besides keeping your contingencies in check, there is another component of the offer that will help set you apart from the crowd and it’s fairly obvious — the offer price.

If it is possible for you, consider putting down a larger deposit which will let the seller know you are serious. Be flexible with the closing date to accommodate the seller’s schedule. And know that the sellers are likely to be enticed by a big payout, or if possible, a cash offer. Offer the asking price – and even more, if you think you can swing it. Use a mortgage calculator to see what your monthly payments will look like.

Write a personal note to the seller

Remember that many sellers have an emotional attachment to their home and moving is often hard for them. They’ve put their heart and soul into the home, built families, and made memories in the home. Write a note letting them know why you love their home and how you plan to take care of it. They may love to hear how their home will be in good hands.

Be prepared to negotiate

The whole experience of buying a home is emotional and if the home you are trying to buy has multiple offers, this isn’t the time to throw in a lot of extras. Keep the contract as clean as possible by not asking for extras such as closing cost changes, home warranties, appliances or furniture.

The Bottom Line: Be flexible. As a buyer in a seller’s market, not everything will go the way you want it to. Be patient. If you are working with the best Realtor, they will have the experience to keep you calm while guiding you in the right direction.

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