Buying a Home in a Buyer's Market
When is the best time to buy a house? With many markets reporting an abundance of homes for sale, and interest rates remaining at near historic lows, now might be one of the best times in recent memory. While today's real estate market does offer advantages to buyers, consumers still need to be savvy in order to get the best deal they can.
The following are some things that the professionals at Coldwell Banker Real Estate Corporation think every homebuyer should keep in mind:
Don't Try to Time the Market. When home prices are lower, it is very tempting for potential buyers to try to wait as long as possible in the hopes that prices will decline even further. This strategy can be detrimental. When there is high inventory, smart sellers price their homes properly - not according to past sales but according to current conditions - so their homes will sell in a timely fashion. Once a home is priced to what the current market will bear, buyers will make offers.
Shop Around. But Don't Wait Too Long. NAR, the National Association of Realtors, reports that, on average, homes stay on the market for 7.5 months. The increased inventory gives homebuyers a great opportunity to compare homes that meet their needs. However, this does not mean that homebuyers should procrastinate. If you find a house you love, submit your bid and negotiate. Don’t provide an opportunity for another buyer to make an offer as you may get into a multiple contract situation and then it will cost more.
Watch Mortgage Rates. Previous studies by Coldwell Banker® Homeownership in America Index revealed that the majority of people move based on lifestyle changes such as new job, marriage, divorce or family expansion. Pay attention to the mortgage rates and recognize that buying a new house will likely result in a change in mortgage rates. How much? Visit our Mortgage Calculator.
Negotiate on the Incentives. Sellers eager to move their homes may offer you a variety of incentives such as closing cost or landscaping incentive. If you accept an incentive, make sure it makes sense for you. Instead of having your landscaping done, it might make better sense to apply the money to your closing costs and do the landscaping later. Of course, you can always ask the seller to simply deduct the amount in question from the list price.