Deerwood Realty and Friends Podcast
In this market, which heavily favors the home seller, buyers can easily be frustrated and I know some have even given up. Here are some tips on re-setting your search and dealing with the frustration of what has become one of the more difficult environments for home buyers in history.
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Thoughts: Here are some ways I look at the real estate market when I am working with buyers. I feel like this mindset can be helpful because as a buyer’s agent I deal with the same frustrations over and over and I’m used to them.
1. Remember your original reason for purchasing a home. As the search for a new home goes on and on, buyers start to forget the reasons why they wanted to buy a home in the first place. New Job, New Partner, New addition to the family…all of these reasons are joyous events in one’s life. When it comes to finding a house, sometimes buyers will forget why they started looking in the first place…complacency sets in, and then disgust. Keep the reasons for your search for a new home at the top of you mind.
2. Think about the process of finding your new home as a hunt….or a contact sport. As a buyer you have to get out there and look. But it’s like a hunt, or a sport. You are going to have success and failure, but that it part of the journey. There are other buyers and agents who aren’t going to be playing by the same rules as you, and that’s ok. You have to understand that this is a competition and that there are winners and losers. The winners are people who make it to the point where they’ve found a home they love and will live there happily for years. The losers are the ones who overpaid for a house that they never liked in the first place. I get that it’s a serious decision to buy a home, but it’s also a game.
3. If you lose out on a bidding war on one house, Don’t give up. The market is so hot right now. Buyers want to buy a house and so they ask their agent, “how much above asking are we going to have to go to get this house?” As an agent, I can’t always tell you because I have no idea how crazy one group of buyers might be. But let’s say you made a competitive offer and you came up short. It’s OK to get upset. It’s OK to be disappointed. Give yourself a day or two and then GET BACK AFTER IT. I don’t know why, but the minute you stop looking, the house you would have fallen in love with will have come on the market and you will have missed out.
4. Look at houses where you have some balance. Home sellers and their agents are currently in the best negotiating position. However, some overplay their hands, limiting showing times, limiting the offer process, and attaching asking prices that are truly ridiculous. Let them go. If your agent tells you going in that there are no advantages for you as a buyer, don’t bother with going to the house. Don’t give the seller the benefit of a home showing. That’s only going to feed their ego. Instead, choose houses where you actually have a shot at making an offer that will at least be considered.
5. Beware of off market properties The market is really hot right now, and that tempts buyers to think creatively. One of those things is to seek out off market properties that are not being marketed heavily. Be Careful! Sellers in those situations are usually looking to take advantage of a buyer who is unrepresented by an agent and that doesn’t have a good idea of pricing in a particular area. This is a perfect place to get burned as a home buyer.
6. Give yourself enough time to make a decision. I see so many buyers put themselves in bad positions by not giving themselves enough time to make a decision. When there is a home that goes active, make an effort to go see it early. This gives you some time to consider making an offer. If necessary, you can schedule a second showing. I’m amazed by the amount of times my buyers have gone through a house one day and then on another showing decide that the house just doesn’t make sense for them. It’s much easier in terms of time and money to walk away from a home before you’ve gotten an accepted offer. Make sure that you give yourself enough time.
7. The chances of getting an offer accepted are kind of random. Understand that you could make offers on 5 houses and not get an accepted offer but get an accepted offer on the 6th one, or you could get an offer accepted on the 2nd house you looked at. It’s truly random. If you are interested in a home and you write an offer, that offer has no relationship with any other home you’ve made an offer on. Each offer stands on it’s own. There are no awards given for the most rejected offers. It’s quite random.
8. Stop looking for that “deal” that isn’t there. I see so many buyers look at houses, then look at Zillow and then if they see a house where the asking price is lower than the zestimate, they are convinced that this house is a deal and that they are the only ones who know about it. In this market, there are so many eyeballs on a house that there are no deals. The zestimate isn’t nearly as accurate as the people who walk through the house making offers on it.
9. You should set a limit on your asking price before you make an offer. When you’ve looked at a bunch of houses in a particular area, and you’ve seen relevant comps, set a limit on your offer. If you don’t get the house at the price you’ve offered, allow yourself to move on confident in the fact that you made your best offer. I see so many uninformed buyers making crazy offers on houses. These buyers are playing a game to see how stupid of an offer they can make. That should not be the game you are playing. When you have a comfort level with your offer price, it’s much easier if you do lose in a multiple offer situation because you had some idea about what your comfort level is. Sometimes deals just don’t make sense.
10. If you do buy a house AS-IS, at least get it inspected so you know what you are getting yourself into. You should always get a home inspection as a buyer. Will the inspector find everything wrong with a house? No….but they are trained to find a lot of things that you’d never think of when you buy a house. The purpose of the inspection DOES NOT have to be as a basis for negotiation, it can simply be for peace of mind. The temptation to compete with other buyers is to waive your inspection contingency. I think that’s a mistake. A better path would be to find some common ground in the negotiation of repairs needed.
11. You will never buy a house without making an offer. I see some hesitation with buyers and writing in two different ways.
1. Buyers may like a home but not the asking price. Rather than “insult” the seller with an offer, they don’t bother writing. There’s a difference between a lowball offer and one based on the market you are in. Sometimes sellers misprice their homes. Although they may actually believe they should get x for a house, they may not get any offers and your considerate offer may make a lot of sense.
2. Buyers may like a home but are dissuaded by the competition. Whenever buyers want to write an offer, I call the agent and they tell me what the situation is…many offers in hand, no offers in hand, etc. Condition your offer on what we learn. Don’t worry about the competition as long as you feel confident in the price you’ve offered. If the house has 40 offers, the seller isn’t going to remember yours if it was the 20th best…no need to feel embarrassed. You gave it your best shot.
3. While it feels like a big deal to write an offer on a house, it really only becomes a big deal if the offer is accepted. Buyers seem to want this situation where they write an offer and it gets accepted every time. Unfortunately, it doesn’t work that way. IF you like a house, write an offer. If you get it, great! If you don’t, continue your search. Don’t worry about the number of offers you make. The key is making an offer in the first place.
12. Know that there is a house out there for you. Homebuyers need not be discouraged. I know there is a house out there for you. I’m constantly amazed at the opportunities that arise for my home buyers. It’s like they are meant to have a particular house. This has happened so often that I now actually believe that buyers will get the right house for them. It may take weeks, months, or years, but the right house is out there. You may have made offers on 10 houses, but the 11th is the one.
Source: Me
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