The market has been changing a lot over the last couple years and a buyer has to be aware of what the current condition of the market is and what the best approach is for buyers in the current market.
Current Market Conditions for Buyers
Last Spring and Summer’s market for buyers was one where demand was high, inventory was extremely low, sellers were less negotiable, nice properties that were priced well often sold very quickly and in some cases there were bidding wars between buyers.
This year we are seeing prices about 10-15% higher than last year but even though sales are at or near the range they were last year they are not increasing at the pace they were and inventory is up slightly. Sellers that priced their properties too high are having to reduce the listing price and it is taking a little longer for properties to sell (except ones that are in good locations and in good condition and priced well) – and bidding wars are much more rare.
So overall conditions have improved for buyers a little from last year but it is important that you don’t make the mistake of thinking that it means we are back in a buyers market where you can easily beat down sellers on their price or that if a property has been on the market for a while that it isn’t going to sell and you can just take your time.
I had a buyer in town recently who saw what I mean in the above paragraph. They had seen a house last fall and decided about a month ago that they should put an offer in on it, it had been on the market since last June, but when they looked it up online they saw that it had just gone under contract. When they got here we went to see another house in the same area that had been on the market for about 3 1/2 months. We went to see it on a Saturday and were told by the agent that they had gotten an offer in the night before. My client liked the house and wanted to buy it but by the next day it was under contract with the buyer who put the offer in Friday.
This has happened to other buyers – thinking that since something has been on the market a while meant it would still be available for a while and then it sells when they decide to proceed. The lesson to be learned from this is that as a buyer it is best to be able to make decisions quickly (which is different than making a hasty decision) and to act quickly when you do decide on something you want to buy.
Best Approach for Buyers in the Current Market
The most important thing I can recommend for buyers is to be prepared. As I mentioned above it is important to be able to decide and to act quickly to get what you want and the only way to do that is to be prepared.
There are 2 main factors in being prepared.
1. Know what you want. If you’re going on vacation you normally don’t get in the car with your suitcases and family without knowing where you’re going. The same is true for buying a home or condo.
Narrow down the areas or communities, even to specific neighborhoods or complexes if possible. Write down what your basic criteria are: what type of property, how many bedrooms and bathrooms, how big, house needs (garage, yard, pool, etc.) or condo/townhouse needs (community pool, allows pets, etc.), price range, etc. Then write down what is non-negotiable (must have) and what would be nice to have (not a must have). Keep in mind this may change but it will at least give you an idea of what you are looking for which will make it easier to say ‘no’ to places that don’t work and to make a decision on ones that might be a possibility.
2. Have the financial aspect lined up. If you are paying cash this is easier. If you are going to be getting financing, you definitely should get preapproved by someone who knows what they are doing. Most sellers will not consider an offer these days unless they are provided some proof you are qualified to make the purchase and if you wait to do this until after you find something you like, the delay in getting preapproved could be just enough time for another buyer to come in and put the property under contract.
If you have done your preparation by completing the 2 points above, you will be in the best situation to be able to get the home, condo or townhouse you want to buy when you find it.
I’m more than willing to help you in any way that I can but I will always tell you that the above 2 points are crucial if you want to be successful at buying.