12/19/2021
Hey there eager buyer! Are you ready to purchase a home? Well, don’t act before taking these tips into consideration.
As a veteran realtor, I can honestly say I’ve never seen the market quite like this. The entirety of the United States is currently experiencing one of the greatest seller’s markets of all time, and the Dallas metroplex is no exception. Since sellers are getting all the attention, I thought I would share some love to buyers!
What you have heard is true! Interest rates are at an all time low, and this excites buyers because it feels like a good deal! However, every good deal comes at a price. Since the real estate market is constantly in flux, lower interest rates are always coupled with higher priced homes. For example, a home that would normally value at $200k is currently going for $300k. Even though the interest rate is between 2-3%, you’re actually paying 100k more for the house than it is worth.
If you’ve been in the buying market lately, then I’m sure you’ve encountered the dreaded bidding war. These bidding wars are not for the faint of heart. Not only are the wars composed of multiple buyers all going for the same property, but also buyers who are willing to waive their right to an appraisal - a valuation of the property by an authorized estimator. An appraisal is a buyer’s negotiating shield against overvalued homes. If you’ve been a victim to a bidding war, each time you put in a bid and learn you’ve lost by thousands of dollars rather than hundreds you may begin to feel the hope of ever owning your own home waning.
Do not lose hope. Here are some tips to navigate this seller’s market:
1. Take your time. Economists are estimating the real estate market will burst soon. When the market bursts, the scale will begin to tip in favor of the buyer. As the buyer, you will have access to a larger number of houses (inventory), lowered housing prices, and greater negotiating power as sellers will be forced to sell.
2. Hold on to your down payment. A down payment can range from 3-10% of the amount of the loan. There are also down payment assistance programs available for which you could be eligible. Just keep in mind that these programs may cost too (stay tuned for another blog post on this topic). Be aware of your budget and put the down payment in the bank to allow interest to accrue. In other words, make your money work for you! That way, when the time is right you will be ready to purchase.
3. Get your documents together. Some of the items you will need are: tax returns, W2, 1099, and bank statements.
Navigating the seller’s market is not easy for any homebuyer. As a new homebuyer, you want your property to be a sound financial investment for you and your family’s future. Therefore, it is important to pay attention to the timing of the market. If you purchase before the bubble bursts, you could fall victim to financial upset by losing equity. Equity is the amount between what is owed and the property’s value. If the value is inflated, then you will owe more than the property is worth. Even a lowered interest rate will not help you regain lost equity. In short, don’t pay more now because you will also pay for it later.
For more real estate tips contact me today!
Jacqueline Gibson, Your Expert Realtor
United Real Estate
469-980-8308
http://www.thelilrelady.com/index.html
