Tips For Buying Real Estate in a Sellers Market – Step 2

February 24, 2013 by · Leave a Comment 

In our first part of this three part series we stressed the importance of speaking to a lender and getting pre-qualified before immersing yourself in a home search. After getting pre-qualified its time to move on to step two.

Step two. Do your homework. Now I’m not telling you to try to do the work of a Realtor but in today’s market you are empowered as a buyer. There are many tools and sites out there that can assist you in finding just about anything you want to know about most properties on the market. Of course you won’t be able to get the most detailed or up to date information we can as Realtors but gathering as much information about area and location will help narrow down your search and allow you to focus on properties that you want to put offers on.

Given the current state of the market, initially we like to show our buyers no more than 5 properties on our initial home search. It’s kind of our rule of thumb. We do this for a couple reasons. First, it saves time and money for you and us. I know that if I put somebody in my car and I take them to 20 properties over the span of a month chances of them finding what they are looking for is greatly reduced. Expectations haven’t been met because the homework on the front end hadn’t been done. Secondly, we don’t want to chase the market. Buyers who are chasing the market tend to submit offers much lower (or higher) than will be accepted by sellers. In this market the good deals will have accepted offers in a month or less, often for within 2-3% of the asking price. Sellers don’t accept offers that are too low for obvious reasons, but offers that are too high? Keep in mind if you are financing the home through a bank, that bank is going to require a third party appraisal. If the home isn’t worth your offer you aren’t getting financed.

Keep in mind, if you are considering viewing a home that has been on the market for some time, more than likely there is a good reason that home is still on the market. Chances are the price is too high for what the home offers and/or it may have maintenance issues or an uncooperative Seller. Knowing what the values should be in an area from doing your homework with your agent is crucial to knowing where your offer should be to come out with the accepted offer.

In our final part of the series we shall discuss the most important component to searching for a home in this market. Stay tuned!

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