The real estate market is on fire right now. More than 80% of Americans ages 18–34 said now was a bad time to buy a home, and the median home-sale price reached a record high of $365,000 in January. That’s a 28% increase from January 2019! The inventory simply hasn’t kept up with buyer demand. If you’re looking to buy a home, these statistics may seem staggering — and even frightening. That’s where we come in. In this post, we’ll go over the top seven things every home buyer should know in today’s real estate market to empower you to make the best decisions for you and your family and tackle this market head-on.
#1. It’s a Seller’s Market
If you haven’t heard, it’s a seller’s market. What does this mean? Basically, when demand for homes exceeds inventory, sellers are at an advantage because competition is stiff among buyers. This often leads to full-priced offers and even offers well above the asking price. In seller’s markets, homes sell extremely fast.
#2. Be Prepared to Be Flexible
You finally find your dream home. It checks off all the boxes and even comes with a killer walk-in pantry. You can’t wait to place an offer, so you call up your real estate agent to start the process. Soon, you find out you’ve been outbid by $100,000 cash! Now, not every scenario will be this dramatic. But, you should prepare to have your heart broken a time or two in this market in terms of being beaten out by other homebuyers with better offers and more capital to spend.
#3. Move Fast
Interest rates are on their way up in both the U.S. and Canada. So, if you’re considering buying this year, you need to start making moves ASAP. The rates are expected to increase to as high as 4.5% by the end of the year, so the sooner you can buy a home, the better to take advantage while the rates are still somewhat modest.
#4. Find a Real Estate Agent
Nobody should tackle this aggressive real estate market without a qualified and experienced real estate agent. Your real estate agent can be your biggest weapon in the fight in terms of negotiating and finding your properties before they’re listed, so you don’t have to worry about the increasing competition.
#5. Be Accommodating
In a seller’s market, you are at the seller's mercy. This means that you must be open to accommodating the seller in terms of contingencies and the closing. If the seller needs more time to move or won’t oblige to any of your contingencies, you may need to be adaptable so that they don’t move on to another buyer.
#6. Appeal to the Seller
In all the busyness that is today’s real estate market, it’s easy to get caught up and forget that there’s a human being behind the homes you’re looking at. Understand what the sellers want from their sale and try to appeal to those goals. If your real estate agent has a relationship with the seller's agent they may be able to better understand the seller's goals. Is it to get the most money for their home? Is it to move quickly or do they need to lease back the property? Tapping into that human side may help get your offer accepted.
#7. Don’t Give Up!
Trust us. We know how frustrating this process can be. After being outbid time after time, you may want to give up but don’t! Keep your options open and your hopes high, and you will eventually find — and win the bid — on a home that will suit your needs perfectly.