If you’re looking to buy your first, or next, home in a seller’s market at a lower price, you may have a tough road ahead. Simply based on the basic laws of supply and demand, a seller’s market means that sellers have the upper hand. Odds are, their home will sell quickly, maybe even above the asking price, without much pushback from buyers.
Right now, the majority of the housing market in the U.S. is a seller’s market, with home prices rising in the 20 largest cities across the country, and inventory tight. USA Today reports that some of the hottest markets in recent years, such as San Jose, Seattle and Las Vegas, have continued to post double-digit price increases annually. Experts say that while the number of newly built homes continues to grow, it hasn’t kept pace with the population growth.
A home buyer in a seller’s market usually has to act fast, bidding high and often bending over backwards to get the seller to accept their offer over offers they may already have. Just imagine, you’re scouring through the condos for sale in CT – and find that ideal home. You know it’s “yours,” the neighborhood is ideal, the size is perfect, it has all of the special features you were looking for and then some. It’s even within, or close to, your price range. But there is one little problem – many other potential buyers love it just as much.
This kind of “hot” market is challenging for a homebuyer, but there are ways to buy your home at a lower price.
Get a Pre-Approval Letter
Your first step should be to get pre-approval to show the seller you’ve been financially vetted. It can help you act quickly when you find that home you love as well as provide an idea of how much mortgage you can afford.
Secure a great real estate agent
While you don’t have to have a realtor to purchase a home, hiring a great realtor with lots of experience can give you a serious leg up on the competition when buying a home in a seller’s market. Look for an agent with a proven track record of winning offers, and one who stays up on the latest listings, knowing every property that comes available as soon as it hits the market.
You may be able to find the right real estate agent by talking to co-workers, family and friends, searching through online reviews, or even driving around the neighborhoods you’re considering looking for “sold” signs with the agent’s name and information included.
You’ll improve your chances of landing that home if you can be flexible by moving as quickly, or as slowly, as the seller prefers. If a seller hopes to close a deal within 30 days, they probably won’t be all that interested in an offer from someone who isn’t going to be ready to move for double that amount of time. On the other end of the spectrum, some sellers may need more time before moving out, and may be more interested in someone who doesn’t need to move in until a later date.
Find Commonalities with the Seller
While some sellers are always going to go with the highest offer, others who may have an emotional attachment to the home, could be looking for the right person or family to move in. Show the seller that you’re not only serious, but emotionally invested in the sale by writing a personal letter. If you have commonalities with the seller, perhaps you’re both veterans, both love the same pro sports team, enjoy gardening or what have you, bring that up. Write about why you love their home and how you plan to take care of it. When a seller knows their property is going into good hands, it can provide some leverage for the buyer.