First time home buyers are looking at a market that shows no mercy, is highly competitive and does not reflect the conditions of a so-called "depressed real estate market." It is not easy to find a good house at the entry level without having to compete with other buyers, but with persistence, good preparation and the help of a professional local Realtor your chances of becoming a homeowner are better. Above all, be realistic, your very first house is not your "Dream House" but getting on the homeownership wagon will eventually get you there.
Many home buyers have decided to jump off the fence and buy their very first house; perhaps it was the drop on interest rates to historical lows, or maybe the number of perceived bargains offered by the banks and a high inventory of homes for sale. When all these factors are put together, you will think it's heaven and you will have the time of your life choosing the best possible home at the best possible price with an incredible low interest rate for the next 30 years... or is it?
This is not the true picture of what we are seeing today. It appears that properties that flooded the market before and kept the inventory high due to their inability to dispose of those properties, have finally figure out how to sell them... by under pricing them! This strategy has been paying off for them very nicely. Buyers trying to outbid each other will push the price to the highest point the market can bear.
How can a home buyer compete and win this bidding war? By understanding how offers are viewed by the seller and being prepared to meet those requirements as much as possible. If you can pay all cash, there will be no financing contingencies or appraisals to wait for, but if that is not possible, follow these steps to strengthen your position and get your offer accepted;
- 1. Do a complete loan application and bring every piece of paper requested by the lender
- 2. Have the bank issue a complete pre-approval letter, signed by a real person
- 3. Offer to pay more than the asking price if you can
- 4. Put a large down payment if possible, this will help when your offer is compared to others
- 5. Be prepared to take the house on an "as-is" condition and spell that out in the contract
- 6. Reduce the inspection to about 5 days maximum
- 7. Reduce the close to less than 30 days if possible
Realize that the sellers don't care who buys their house, all they look for is to get the maximum amount of money they can, in the quickest amount of time with the least amount of inconvenience. They don't want to do any work, or wait too long to close or pay for anything extra.
This market offers you a great opportunity to make the purchase of a lifetime... but others are also aware of these positive conditions and you will meet them when they compete with you... just when YOU think YOU found YOUR dream home. Happy House Hunting!
Feel free to contact me at 905-407-7381 or www.bradstevenett.com