One thing that 2020 has brought us is BIDDING WARS! When you combine low mortgage rates with a shortage of houses for sale, expect to see a surge of multiple offers on a single property. We've personally seen some of our clients find themselves in these bidding wars and things can get fierce. Now more than ever, it's vital that before setting out to purchase a home, you're fully prepared to do so. This means already being pre-approved, having an idea of what you want in a home, and being ready to submit that offer when the time comes.
Keep reading to learn how you can better prepare yourself for purchasing a home during this season!
Get A Pre-Approval
Our first piece of advice is something we can't stress enough. Before you start shopping for homes, you need to know exactly how much house you can afford. This is why it is CRUCIAL to get pre-approved first. According to a survey done by Realtor.com, "...52% of active homebuyers acquired a pre-approval letter before starting their home search". This reveals that about half of active buyers ended up missing out on this step of the home buying process!
When you're pre-approved, not only do you know what you can afford (because imagine falling in love with a home and it's out your budget), but it shows a seller that you're a serious buyer. And, during this competitive market, you WANT sellers to know you're serious. So remember, before you start looking at homes, speak with a mortgage professional! If you don't know any, we're more than happy to connect you with a mortgage lender!
Give Them Your Best
Not to sound repetitive but, because of the competitive market we're in, sellers may decide to review all offers at one time. Keep in mind the possibility of multiple offers being on the table.
When you consider these two factors, you may not have a lot of time or negotiating opportunities. For example, you submit an offer that isn't your greatest, with the hopes of being able to negotiate with the seller at some point. However, because of the climate we're in, that moment may not happen. A seller can easily move on to other offers and, you could've missed out because you didn't submit your best.
Essentially, your first offer should be your best. Don't worry though, you're not going to be alone during this entire time. We're going to be here helping you prepare your best offer!
Now when we say be quick, we're not advising you to make an impulsive decision. Buying a home is not a casual shopping trip where you buy something, later realize you don't even like the item & go and return it. Purchasing a home is a HUGE decision and you want to make sure that whatever home you plan on buying is right for you. With that being said, you don't want to wait TOO long to make a decision. NAR reported that home sales have rapidly sped up:
“Properties typically remained on the market for 22 days in July, seasonally down from 24 days in June and from 29 days in July 2019. Sixty-eight percent of homes sold in July 2020 were on the market for less than a month.”
With this being the current situation, as a buyer, you may not have an excessive amount of time to sit and think about whether you want to make an offer. When you find the property that you can imagine yourself in, make an offer as soon as possible! The reality is, if you love a property, there's someone else that loves it too!
You may feel slightly hesitant to step into the housing market now but, we're here to reassure you that, this couldn't be a better time. If you're planning to purchase, let's talk about your wants and needs, and get you into the home of your dreams!