Hot Housing Market Tips for Homebuyers
Recently, I was interviewed about Austin’s hot housing market by Sarah Wheeler, Editor in Chief of Housing Wire. We talked specifically about what homebuyers need to know as we look at Austin and surrounding areas. Here are some tips from that interview.
Prepare your finances.
A hot housing market means being prepared. Assess your credit. Undoubtedly, this is essential to understanding your financial condition. Furthermore, a lender will use your credit score to approve your loan. The consistent review allows you to correct inaccuracies and manage your credit position.
Do you intend to pay cash or with a mortgage? If you need a mortgage, get pre-approved*. Realtors and sellers will take your offer more seriously. Also, a pre-approval helps a buyer set a budget, which helps a realtor steer you to houses in your budget.
Don’t be surprised to pay more.
Low inventory is driving up offers on “asking price.” Buyers often find that to have an offer accepted; they must be willing to pay more than the asking price.
Patience is key.
Be prepared to be patient and diligent. Though recent data indicates that the market is normalizing, many realtors see multiple offers over the asking price.
Plan dates wisely.
Fannie Mae is allowing fewer property inspection waivers. Therefore, appraisers and inspectors are in high demand. Consequently, the usual 10-day turnaround time for an appraisal has increased to 3 and sometimes four weeks. Therefore, make sure that your realtor is aware of this potential delay. Also, good communication with your lender is key here. Writing offers to include extra time will help you to manage successful closing dates.
We lock-step with real estate agents to help get our clients in houses. We know and see more appraisal gaps (difference between property valuation and offers). Undoubtedly, it is essential to be flexible and responsive and focus on maximizing liquidity.
Moreover, one of the best strategies is knowing your budget and shopping for homes under that threshold to allow yourself room to bid up if needed.
A responsive realtor who makes your offer stand out is essential. In particular, a realtor can offer contingencies like leasebacks to allow a seller time to find another place to move.
Be open and patient. At this time, a ready-to-move-in, turn-key house is harder to land. Therefore, you need to be open to other tactics. For example, a renovation purchase will allow you to purchase and fix up a not-so-great home into your dream home.
What questions do you have?
We love questions! And we thrive on helping homebuyers to become happy homeowners. Connect with us, and we will be happy to help!
*All loans subject to identification of an acceptable property. Conditions and restrictions may apply.