Buying a house can get downright competitive these days. Nationally, the demand for homes has outstripped supply. Mortgage interest rates remain very low. Household incomes are on the rise. And prospective purchasers are getting off the fence and increasingly committing to a property of their own. Consequently, would-be buyers must prepare to act fast and pursue effective strategies to win their desired dwelling.
What’s Driving The Demand? We’ve had record low inventory for a couple of years now, which creates fierce competition for buyers. This is mostly due to the recovery from the recent recession. Sellers on the top end are reluctant to sell, as they are still trying to recoup the perceived value they lost during that time. This, in turn, stalls the move-up market, which creates a tight market for first-time home buyers.
Get Professional Help Expect to be in competition with other buyers for the same home, and be prepared to pay asking price or over it. And enlist an experienced REALTOR who can negotiate on your behalf and is skilled at closing deals. Prospective buyers should utilize the knowledge of their entire team – including their real estate agent, and mortgage provider
A Pre-Approved Buyer Is A Serious Buyer In addition, get the financing process underway and get all the paperwork together your lender requires This also means obtaining a pre-approval letter from your lender that you can show to the buyer that demonstrates your sincerity. By getting pre-approved, you will also know your buying power and how much you can increase your offer price to still remain within your payment budget and loan approval
Know Your Limits It’s vital to determine your ceiling, too. Be aware that if you want to purchase a property for a higher price than its appraised value, you’ll have to cover the difference. For instance, if you’re buying a house for $200,000 with five percent down ($10,000), and it appraises for $190,000, you must negotiate a lower price or come up with an extra $10,000 down payment.
Stay Positive Lastly, don’t get discouraged Keep a level head and know that there always be another house Every buyer that I’ve ever had who has lost a house in a bidding war has ended up buying something they like even more in the end.