If you’ve decided to buy a home this spring, good luck to you. Your challenge will be not just finding a home you like, but also beating out all the other homebuyers who like it and want to make an offer on it, too.
The number of homes for sale is low nationwide, particularly in the price ranges desired by first-time homebuyers. The latest figures from the National Association of Realtors show that that there was only a 4.4-month supply of homes for sale in February, which is lower than the six-month supply that indicates a balanced market. One-quarter of February’s transactions were all-cash sales, according to the NAR, and investors bought 18 percent of the homes that were sold.
“A well-priced home in good condition will usually move very quickly and often have multiple offers,” says Mary Ann Hebert, broker and partner at Better Homes and Gardens Real Estate Bannon & Hebert in Middlebury, Connecticut.
That means that if you want to end up with a nice home, you need to be strategic. Expecting to find the home of your dreams by nonchalantly walking into a few open houses or perusing some online listings is not realistic in this seller’s market.
“In Raleigh, it’s insane,” says Tiffany Alexy, broker with Lucky Penny Realty in North Carolina. She advises finding a good real estate agent who knows when and how to negotiate. While everything is negotiable in real estate, sellers are often less inclined to deal if they have other offers waiting in the wings. Plus, if you’re a buyer,working with an agent usually costs you nothing because the seller pays the full commission.
These days, most would-be buyers come to an agent with a list of homes they’d like to see based on their online research. While that often serves as a solid starting point, a quality agent may find additional options. After buyers have seen a few properties, Hebert says skilled agents can typically gauge what they’re looking for in a new home and may have other properties lined up. “I advise them to listen to their Realtor,” she adds.
Victor Quiroz, a millennial agent who just taught a workshop called “How to Write a Winning Offer” to agents in California, advises those agents to go old-school and talk to the listing agent on the telephone because that will yield a lot more information about what the seller really wants. If you’re the client, suggest to your agent that he or she make that phone call and report back to you.
“Call. Don’t text, don’t email,” says Quiroz, from Berkshire Hathaway HomeServices California Properties in Covina. “You’ll get a lot more from a phone call than from a text message or email. … Don’t just send them a text. That’s not going to work.”
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Knowing what’s most important to the sellers can be key to creating a winning offer. “It’s all negotiable,” Alexy says. “If you have a good agent, they’ll find out the motivations of the seller.”
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Here are nine tips to help you get the house you want this spring.
Get your finances in order first. Several months before you intend to start looking, you should get copies of your credit reports to make sure you’re in a financial position to buy. Shop for mortgage financing before you start looking at houses. “I will not take anybody to see any house unless they have a preapproval letter or proof of funds,” Quiroz says. “I want proof of funds to show the seller.” Alexy says that some lenders are doing the underwriting before the house is under contract, which shortens the closing time and can be more attractive to the seller.
Move quickly once you find the house you want. That often means rushing out to see new homes within hours of them being listed and writing up an offer immediately if you like the house. “Things are gone in a matter of hours,” Alexy says. “You really have to move fast.”
Don’t make snap judgments based on listing photos. A house that doesn’t lookappealing in photos could still be a great house. Homes being sold by an estate or homes with tenants inside often yield particularly poor photos. Plus, photos fail to convey the feeling of a home or the floor plan. “Unfortunately, the pictures don’t tell a true story,” Hebert says. “You have to be willing to look past some of the pictures.”