Good morning! Did you get out to the Whiskey Row Marathon this morning? Hello, I'm Gary Edelbrock, and I'm glad to report that home sales appear to be picking up. As a matter of fact, according to Lee Amble, it can even be considered a "sellers' market." Here are some tips he offers to buyers.
Money Alert: How To Buy A Home In A Sellers’ Market
By: Lee Amble, Consultant, Realtor
I hope this article will make your efforts of buying a home much easier and also save you money and time in the process. It will, at the least, give you many ideas which you may not have thought about plus some that will irritate some realtors - that should be fun, no just kidding!
The following ideas come from my 37+ years of selling real estate, which have included many different buyer and seller cycles. The hardest one for both buyers and sellers may have been :
1. The high interest rates of 19% to 22% in 1978 to 1982 approximately.
2. Desert Storm, when everything in real estate just quit for many months.
3. The 9-11 attacks on the New York World Trade Center and the Pentagon in Washington, D.C., which for many of us had longlasting effects.
4. The last long cycle was the housing recession of 2006 to 2011 leading to a Nation near collapse.
But, we as proud Americans got through all of them and we, as Americans, will always rise to the occasion as we have done in the past!
Please, let’s all take a minute of private silence for the people of Boston and West Texas and help make them and our Country even stronger.
Now, Money and Time Saving Ideas in a Seller’s Market
The following will not be in any particular order, just things that come to my mind as I am thinking and writing my article.
• Cash or Loan or a combination of both:
Have all your funds lined up and arranged before you look at your first house with a prequalification form completed by the lender of your choice, as the first thing a realtor will require is one. Without that being 100% done, we cannot even think about making an offer on a home as we wouldn’t be informed as to your qualifications.
• Buyer’s Agents:
I recommend working with an experienced, successful buyer’s agent, when possible, as there is nothing that can replace success and experience. Other realtors will not like this at all, oh well! I would not sign a buyer’s agent agreement, which ties you to that realtor, as you should keep your options open to be able to get a new realtor if the first one chosen does not work out and/or you realize you’re not compatible. You should be able to fire your realtor, with good reason, and the realtor should be able to fire you, with good reason. I never have a buyer sign an agreement until we go into contract as it, in my opinion, is not fair to either party. I have faith in my work experience! Some realtors may not!
• Realtor Team Concept:
Another choice would be to work with a team of 3 or more to help you find a home. There are a few great teams in our area, and there are others, but a good team effort can be great. Again, keep your options open to be able to go on with someone else if you’re not satisfied with the results.
• Lee’s 80% Rule:
I have used this for years and it really is true and makes buying a home much easier for the buyers and the realtor. The buyers should buy a home if it meets 80% of their wants and needs. They will be very lucky to find one that meets 100% of their goals. It rarely happens even if you build a new home. It seems like they’re never perfect; probably because it may look great on paper, and when it’s under construction, it doesn’t appear the same. Remember the 80% rule when home shopping and it will make it much easier and enjoyable! You will be very happy in most cases!!
• Make a Decision Now!
When you find your near dream home, write a contract now. There is no need to sleep on it. Let it be said, while you sleep, as the old saying goes, when you snooze, you lose. Don’t forget, we’re now in a seller’s market, where the inventory may be somewhat limited in your price range.
• Know what you really want:
It’s really pretty simple to figure out what items are most important to you; then, tell your realtor and make sure they are listening. In a seller’s market, you really don’t have the time to be wondering what’s most important to you because while you’re deciding, your potential home may already end up in contract with someone else.
• Reasonable offers and negotiation:
Stupid offers and counter offers usually relate to the same kind of response, meaning, someone else may buy it in the meantime.
• Don’t procrastinate:
It’s the same as I said before, but worthwhile saying again; when you snooze, you lose. When you’re sure of your choice, do it now! Why wait?
• Lipstick, powder and paint items:
Look beyond these items that I call lipstick, powder and paint and/or cosmetic items. They are all easy to fix. Many buyers walk away from them, but you will win by not walking away. Remember, the improvements make it more “your home”! Lucky you!
• Be prepared to pay asking price:
Between yourself and your experienced realtor, you should be able to tell if its fair priced and if it is, pay it or lose it or pay more later! It’s all about a seller’s market, which will not change soon.
• Do not over buy or under buy:
Many people overbuy and buy much more home than they really need and later don’t want. The cost of buying a home every few years is a lot with all kinds of fees, i.e., realtors, title company, title insurance, loan fees, and much, much more. Buy less and save the cost for a better retirement.
Many families just starting out should buy for the future, possibly an extra bedroom or a walk out they can finish later and/or possibly add an addition later. While buying, check the lot lines and setback for expansion; this is really important plus the costs and fees you save by not over buying. The money you’d save for much of the above and the best part is you don’t have to move away from your friends and your kids friends. A real winner!
• Reverse Mortgage:
If you are age eligible, call a Reverse Mortgage Broker, and find out if it’s right for you. Many times it works out great; you can use it to stay in your home or buy a different home, if you have a good amount of equity in your current home. At least, check it out. You probably won’t have to make any house payments, but, remember, you need to live in the home. Sounds nice to me!
• 1st home buyer:
If possible, and maybe needed, partner with your parents or grand parents to get into your 1st home. You should all do well to consider this a legal partnership. Make sure all agreements between parties are in writing and recorded. We like to be friends forever with no misunderstandings.
It appears that a seller’s market is here for some time as the buyers cycle lasted nearly 7 years. We should return to a normal market within a few years as most cycles go. We cannot predict how long any will last because we can never figure out what the Federal Reserve and the Washington politicians will do or not do. In my opinion, what they normally do is more wrong than right.
Last and not least:
You, as a buyer, have a lot of control. You have the money or the ability to get it. Yes, you as buyers, are very important to all sellers and realtors alike. You, the buyer, create jobs and all the good that comes from it. We all thank you!!
Use your resources and knowledge wisely! That’s what this article is about!
I hope this “Food for Thought” article will give you some items to think about. Thank you for reading! If you have any further questions or ideas for articles you would like to read in the future, please call me! The call is free and so are my ideas!
Remember, "Experience Isn’t Expensive, It’s Priceless!"
"Selling A Home Is Easy, Doing It Right Is The Key!"
Lee Amble, Realtor, Consultant