A competitive market puts more pressure on buyers to make quicker decisions, sometimes leading to buyer remorse. With elevated prices, not getting carried away with the market and losing sight of your own budget is important.
When supply is limited and sale prices increase, the odds of finding your dream home at a dream price get slimmer. Having a list of must-haves and keeping to your budget can help make the right purchasing choice. Lawrence Yun, chief economist at the National Association of Realtors (NAR), suggests anticipating having 1-2% of the home price reserved for maintenance. Homeownership comes with unplanned costs as the home needs ongoing maintenance and upkeep.
In addition, these five hurdles play a big part in the buying process but having a real estate agent can help.
Bidding Wars
When bidding wars take place, buyer contracts that waive contingencies over appraisals and inspections can appear better to the seller because if it appraises under the asking price or the inspection has issues, they have waived their rights to use those findings as a bargaining tool to lower the price. While waiving contingencies may get your offer accepted, it may end up costing more in the long run. Having an agent allows for a personalized explanation to why eliminating this protection is unadvised as well as guidance through these difficulties.
Wants & Needs
Having a list of wants and requirements as you go into each home with in mind can help rank the properties. While you’re touring properties in a short amount of time with not a lot of wiggle-room after thinking about writing an offer, creating this list beforehand and going over it with your agent lays out whether or not the property fits the needs and wants or not.
Budget
In today’s recent market where 100+% of the listing price is received is not uncommon, if you have a budget of $400,000, looking at houses listed for that will probably end with you getting outbid. Focusing on a $350,000 range so that you can offer the top bid sets you up for success! Letting your agent know the top limit slows them to set the search up right for properties that you can attain at that price or less.
Compromises
Compromising on some of the needs/wants can allow you to stay within your budget and therefore less likely to have buyer’s remorse. Getting the number of bedrooms, bathrooms, and garage size may outweigh the perfect location, or vice versa. Accepting carpet instead of wood floors, having to repaint the interior, or a longer commute are examples of ways to compromise.
Real Estate Knowledge
As real estate is ever changing along with many moving factors like mortgage rates, inventory, and contract negotiations, having a full-time Realtor on your side can improve the clarity and ease of the home buying process. There are many resources and articles available but customized advice for you will ensure you get the best deal.
Especially if you are a first time homebuyer, access to information is a crucial part of entering the real estate market. Even if you lose out on a contract, that experience helps you prepare for the next opportunity. Please don’t hesitate to reach out to us with any questions. We would love to work together to help you prioritize your wants and needs list, and help you see successful results as a buyer and avoid buyer’s remorse in today’s tough market.
