Since the beginning of 2020, the home buying process quickly shifted into a whole new ball of wax.
A pandemic quickly turned the United States economy upside down and interrupted several things that made a huge impact on the way the real estate market works right now. There has been less homebuilding with supply chain issues, unbelievably low mortgage rates allowing several buyers to afford more homes than they ever imagined, and the need for several homeowners that spent hours on end inside cramped quarters to look into sizing up.
As a result of those and several more factors, many Americans across the country went home shopping and sparked a very hot housing market full of competition and bidding wars on almost every home sale across the country. As interest rates are forecasted to climb on mortgages this has fueled even more interested homebuyers to hurry up and jump on a home purchase before mortgage rates rise again.
With all of these new elements in play, homebuyers need to hit refresh on their gameplay strategy when it comes to shopping for a home in 2022. There are five new rules of homebuying that are common and unspoken every buyer should be prepared to know and face for success in home buying right now.
Begin an offer contract with your strongest offer, not a negotiating offer
In years past when there was more home inventory and a few fewer buyers interested in finding a home, you could write an initial property offer below the asking price and wait for the seller to counter the bid until you came to a middle ground that you both agreed on.
Today the majority of sellers realize that they can turn down an offer that is lower than they like right away as it is very likely that another one is right behind it. You want to come in with your strongest offer possible. While it does not need to be above list price, it should be at least at list price during this moment in time.
It is very rare to have your offer accepted on the first home you want to buy
In today’s highly competitive market with a very low number of homes for sale, many buyers are being advised to be patient and flexible through the process, to not get overly emotionally attached to the first home that fits their wants and needs, and to expect to have to make a few offers on a home before being the buyer with the accepted offer.
The trick here is to have an expert local real estate agent on your side that can help keep you positive in your continuing home search and help tweak up things just a little bit to make your offer its strongest and most competitive possible.
Make sure to lock in your mortgage financing before you start your search
This has always been a great rule when it comes to purchasing a home, however, it is more so important now than it ever has been in the past. Without having a preapproval letter handy you can get easily passed up by other interested buyers that can show a more solid means of being able to financially follow through on the offer they are making to purchase a home.
Now more than ever it is crucially important to be preapproved by a lender and have a very good knowledge of all of your financial details to know exactly what you can comfortably pay for a home and what you will be approved for to pay for a home.
Begin your search by shopping for homes priced below your comfort budget
With the hot competition and bidding wars driving the sale price of homes even higher, it is a smart strategy to find what your preapproval rate would be for a home and what you can comfortably afford for a home and shop for homes just below that comfortable range. Not below your top stretch budget.
If you find a home that you really love, it is very rare for any listed home not to see multiple offers right now and as such very common for buyers to offer no less than list price or above. In the case of being able to compete, purchasing a home well below your comfortable budget will help you to be able to offer a competitive offer. Shopping below your means gives you room to go up in price.
If you find a home that fits what you need and you love it get moving
Homes are selling in a record number of days after they are officially listed for sale. If you find a home that you love you need to move and make an offer as soon as you are done touring it. For this reason, it is very important to know what it is exactly what you want and need from a home.
This includes every detail from the number of bedrooms to the exact location that you know you’ll be happy living. In order to know you will be happy living in a certain location, it is a good idea to do extensive homework on every aspect of where the home is. This includes schools, if needed, extracurricular activities, and surrounding things to do.
For more information on purchasing a home in St. George and surrounding areas please contact me anytime.
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