Buying A Home As A “Normal” Home Buyer
You are a normal home buyer, meaning you are looking for your next permanent residence. It may seem like a tiresome effort, finding a home which would be perfect and put an offer in on it, only to find out an investor came in with an all cash offer and snatched it out right from under you.
The Lawhead Team would like to share some tips for what a home buyer looking to simply buy a house where they will live for years to come.
While there is a limited supply of “nice” homes for sale that are well-priced. And if they are located in desirable neighborhoods, they are selling quickly.
Many of the homes for sale today are rundown bank-owned properties or homes in foreclosure, or homes where the owners are not willing to lower their asking price to current market values. That leaves a relatively small number of homes for sale in the “sweet spot” where they are properly priced, well-located and in good condition.
That’s why we are now hearing stories of multiple offers on some homes for sale. When you have increasing demand for homes caused by extremely low mortgage rates and a relatively small number of desirable homes, that creates a supply-demand squeeze in the seller’s favor. Homes located in the outlying areas are selling slower. As always, the most important factors in determining a home’s market value as a home buyer are “location, location, location.” Therefore, you have a couple of choices if you want to find a nice home to buy.
One choice is to widen your search and look at homes located farther away from the major job centers. But keep in mind that the reason those homes are selling slower is because they are less desirable due to factors such as longer commute times.
So when you sell your home in the future your home’s price will be impacted by the same negative marketing factors facing the current sellers.
Another choice is to find a good “buyers agent” who will scour the market for you on a daily basis and be prepared to rapidly make an offer on a good deal when it becomes available. Some real estate agents require you to sign a contract to act as your buyer agent.
Once you have found a good real estate agent with whom you are comfortable you must look at enough houses so that you can quickly recognize a “good deal” when you see it.
Sometimes your agent might show you a home that was a “steal of a deal” but the buyer is reluctant to write up an offer. Once they decided it might be a good idea to write up an offer, the home was already sold to someone else. Don’t put yourself as a home buyer in that position. Even in a slow housing market, well priced homes sell fast.
It’s tough, but the good news is that this may be a sign that the housing market is finally starting to “bottom.” We won’t know for sure until home prices rise for a couple of years because you can only truly spot a market bottom in hindsight.
But if we are at or near the bottom of the housing market, you probably won’t have to worry about your home’s value falling much, if at all, over the next few years. Just remember, you are buying a home as a lifestyle choice, not an “investment.”