How to Navigate a Red-Hot Market
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Home Buying Tips for Hot Housing Markets
The housing market is heating up! For buyers, this may lead to submitting multiple offers or a potential bidding war. The home buying process can be daunting, especially if you're a first-time home buyer. One of the most important things to remember is that home prices are always changing and fluctuating. There might not be any better time than now to buy a home, but if you don't know how to navigate hot housing markets then you'll end up paying more for your home or getting stuck with something that doesn't suit your needs. In this blog post we'll cover 6 tips for navigating hot housing markets like a pro!
By JEFF NEWTON
Senior Mortgage Banker | NMLS #: 168216
FIND A LENDER & GET PRE-QUALIFIED
The first step to purchasing a home is to find a mortgage lender and get pre-qualified. Getting pre-qualified gives you an idea what you can afford and confidence for putting an offer on a house. By getting pre-qualified for your loan and having a strong cover letter prepared for your seller lets everyone know you are a serious buyer. This will help in the home search process by removing some of the uncertainty and letting potential sellers know that you are serious. The cover letter is a chance for you to show how much time you've invested into preparing a home purchase, which can be beneficial when competing against other offers!
TOP OF MIND
Try to be first in line by submitting offers as soon as you find a home that suits your needs and doing so with all the contingencies in place (such as home inspection). This will give you an edge over buyers who wait until the last minute because they may not have time for home inspections or financing options before Being first to the negotiating table plants you in the seller's mind. But when listings are scarce, lowball offers are a losing strategy.
DON'T GET OUTBID
Opt in for an escalation clause that tells the home seller that you'll offer more money for their home if another buyer offers a higher price. that tells the seller you'll beat any offer exceeding your bid by $1,000, up to a maximum amount of your choosing.
Perform the home inspection upfront. It may cost a few hundred dollars, but it shows the home seller that you're serious and will do your due diligence, which is a win-win for everyone involved.
A home inspection can help uncover structural or mechanical problems with the home. If any issues are found, it would be wise to negotiate some wiggle room in the sales price of the home to cover those repairs before buying!
LETTER OF INTENT
Tell The You Love It
Tell them you love the home by asking your agent to deliver a letter of intent. You can also have your agent submit a home inspection report with the letter (if you've completed one). listing the reasons why this house is perfect for your family (include pictures and be specific). Don't overpay. Instead, research the market by reviewing comparable property sales prices, home values, home prices and other sources of information.
Instead, research the market value by reviewing comparable property sales prices, home values, home prices and other sources of information.
When looking at home sales for similar properties to the one you're considering buying, make sure that they (A) have been on the market for a while; and (B) are in your price range. research schools and online reviews for local businesses. Chatting with neighbors can also provide a wealth of information.