We are often asked where we think home prices are headed over the next year. Recently, several national groups have published reports and given their predictions about the level of appreciation
Home Buyer Tips To Navigate A Hot Sellers Market
Most real estate markets across the country are experiencing similar trends...we’re dealing with a mild to serious shortage of inventory. Many eXp Realty agents that I talk to, no matter what city or state, are experiencing the challenge of not only finding a home for their buyer clients, but of winning in multiple offer situations. The number of homes for sale is not keeping up with the increased demand, brought on by an improving economy and rising consumer confidence. It can be a challenging market for buyers when the competition is stiff. Here are some tips for buyers in a hot sellers market:
1. Hire an Experienced Buyer’s Agent
Using a buyer’s agent to help you purchase a home is a no-brainer. In mast cases the cost of the buyer’s agent is covered in the listing agreement. In many states these days, provisions are made for home buyers to receive the benefits of a buyer’s agent, so why not take advantage of their experience?Today’s home buyers are not lacking in information. No doubt, they are already making use of 8 to 11 websites in their search for real estate advice, neighborhoods, and a home. What they often lack is a professional to help them digest all that information and put it to good use in helping them get their dream home for the best possible terms. A buyer’s agent’s job is to represent YOUR best interest and to negotiate on your behalf.
When buyers know what to expect in the market, they are better equipped to get the house they want.You’ll know what to prepare for and know how to make the right moves when you need to make them. Home buyers who are prepared are better equipped to win in a competitive market. The first step in being prepared is to listen to your agent’s advice. (hence the need for a trusted adviser)Be ready to make quick decisions. Know your mind and what you want. Forget what you saw on HGTV. Those reality shows are not very real, no matter how fun they are to watch. Once you decide to get into the race, don’t dawdle! Get your paperwork ready. Answer the phone. Better yet, put your Realtor® and lender on speed dial! Have a babysitter on speed dial as well.
Yes, this is the NASCAR of real estate markets!
3. Bring Your A-Game… Get Pre-Approved
Most likely, the first bit of advice you’re going to get from your trusted adviser is to get pre-approved by a local mortgage lender. Yes, we know you want to get in the car and start the hunt...the real fun part. But, you’re going to be best positioned if you do the not-so-fun-part first, submit all the paperwork and get approved.
If you take the time to do this up front, you’ll be glad you did, because you will have an advantage. If you find your dream house and encounter the likely scenario of competitive offers, your offer will shine a bit more if you are already approved as a buyer. Put yourself in the seller’s shoes; if you have two offers in your hand that are fairly similar, you’re going to go with the one that is less risky. The one who is already approved for the loan. Read more about why you must be pre-approved for a mortgage.
4. Offer Your Highest and Best
You need to understand that this is probably not the market to get a bargain, unless you want a fixer-upper. Even then, be prepared for competition. If you are in a competitive seller’s market, you’ll need to offer your highest and best. Your agent will do a comparative market analysis to make sure the house is worth the price, and you will be able to count on an appraisal if you win the bid. Again, this is the time to use an agent who has your confidence.When a buyer is competing in a multiple offer situation, we always ask them, "if you miss out on this house because you didn't offer $5,000 or $10,000 more, will you be ok with it next week, or will you be upset? The difference of $5000 or $10,000 may only mean $25 to $50 more on your monthly mortgage payment."Don’t get stuck on the overall dollars and don’t draw lines in the sand. It may end up costing you the house you love.
Speaking of love...here’s one final piece of advice. Do everything you can to keep your emotions in check. As much as we don’t want it to be the case, our emotions are part of the home buying process. Most buyers use their heads to calculate and strategize, but when it comes down to it, they don’t buy a house they don’t love. Keeping a cool head will go a long way in helping you navigate a hot sellers market.
Read more tips on buying a home in a competitive market: Advice for Buyers in a HOT Market .
Contact Chris Highland with eXp Realty for an experienced eXp Realty buyers agent in Maryland. 301-401-5119. Learn more about eXp Realty. Broker: 888-860-7369
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