The entire country is seeing record housing markets in many different cities across America. In hot spots such as South Florida, there are barely any homes listed for sale at any given time. The market is so strong that there are buyers in waiting and all pounce on newly listed properties the second they hit the market, making it seem impossible to purchase your dream home in the city and community you want. Fast moving markets make it more difficult, but nothing is impossible, and using a few tried and true tips which are outlined below, can drastically increase your odds of buying the perfect home today.
Let’s take a deeper dive into a few simple things you can do to make your offers more appealing for sellers who get more than one offer for their property.
IF YOU NEED A MORTGAGE,SHOULD YOU GET PRE-APPROVED FIRST?
There is a big difference between paying cash or needing a mortgage to buy your new home. Cash is fast and easy, and you don’t have many contingencies or things you must qualify for. However, if you need financing, it is important that you get fully approved before you get serious about real estate in hot markets. Remember, you will probably be competing with cash offers from people who sold their properties in other states and are moving here, or investors paying cash.
SELL YOUR CURRENT HOME BEFORE MAKING AN OFFER FOR A NEW HOME!
In 2021, the housing market is extremely active and, making an offer on a home for sale with contingencies probably won’t work too well. In a seller’s market it is important that you make the strongest offer possible to a seller. Obviously, paying cash is the most attractive. However, making offers that are contingent upon you selling your current home first, are considered weak and will not get the attention of a seller who has multiple offers for their property. Even if you must stay with a friend, or rent a home short term, selling your current home before making offers for new properties is paramount to successfully buying a house in today’s market.
BE PREPARED TO PAY OVER MARKET VALUE
This can be a bit tricky because no one wants to overpay for their new home. However, in fast moving housing markets, you will find that there are multiple offers for most of the homes for sale. If this is the case where you want to to buy a property, then it may require you to pay over the asking price if you want the seller to choose your offer over the others they receive. If you are getting a mortgage, this can become more problematic because the bank approves you for a certain amount, which is based upon the property’s appraisal that determines the home’s actual value. It must be valued by the appraiser at or above the contracted price to obtain financing.
As the buyer, you will need to pay the closing costs associated with the loan, along with the down payment amount. This may not leave any cash available for you to give to a seller, on top of the approved loan amount. It is highly recommended that you speak with a licensed mortgage broker who can guide you to the best possible mortgage options for your specific financial needs. You just may need to save up a few thousand dollars above what you planned to pay out of pocket for the loan in case you need to make your offer more appealing to sellers that get multiple offers for their listing.
ARE NEW CONSTRUCTION HOMES EASIER TO BUY?
In many popular cities and states like Florida, new construction homes for sale are being bought up faster than they can build them. In fact, many builders who have created developments that have dozens, to hundreds of homes within them, are doing lot lotteries for customers who are waiting in line for availability. This basically means that you cannot pick the lot and choose its location in the neighborhood. There are so many people competing for a property that the builder randomly chooses names of people who win a specific lot that becomes available upon which to build a home. This makes things fairer for everyone who wants to live in that community but may not give you the perfect lot location you were hoping for originally.
WRAPPING IT UP!
Becoming a homeowner is a goal that many people strive to achieve in their lifetime. While most of the country is experiencing a sellers’ market, you can use these tips to help you gain an edge over all the other buyers in the area. Remember that contacting a licensed Realtor who understands the local housing market can help you create an offer that will appeal to sellers, and that is affordable for you moving forward. If you can be flexible and patient, it is still possible to find a great home to buy, at an affordable price.
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