You found the perfect house, perfect neighborhood, perfect price. You text the realtor to set up a showing and- WHAM! Too late, it’s already pending. But, it just came on the market yesterday. How did you miss it?
Does that sound like you? Don’t worry. You’re not alone. Right now, it is a seller’s market across the country, not just in Northern Virginia. This means that there’s really only less than 6 months worth of homes available on the market right now. This doesn’t mean that you won’t be able to get your dream home. It just means that you have to “shop smarter” than the average person. Here’s what you can do:
Getting pre-approved is good for many reasons. But, in a market like this, it’s important to be able to be “the most attractive buyer” if you end up in a bidding war for a home. When you are pre-approved, your realtor will present that pre-approval letter with your offer so that the sellers know you are a serious buyer that has already been guaranteed for financing. This gives you a leg up on the buyer that has not applied for financing yet.
Be ready to pay listing price
When there are fewer homes to go around, you will see prices appreciate. But, more than that, you will hear about multiple offers on the same home. A lot of home shoppers go in with the mentality of “Noone pays the listing price so I know I can get 20% off.” This just isn’t accurate right now. If you’ve been pre-approved for a home up to $350,000; don’t even waste your time looking at homes over that. You need to accept the fact that if you find a home you like, it’s highly possible you will have to pay the listing price. And, if you love that home and are in a bidding war, you may even have to pay more than listing price to win it.
Have your down payment and a security deposit ready
So, you have your pre-approval letter and are ready to pay full price. What’s the status on your down payment? Make sure that you know how you are getting that money. You also will want to be sure you have a small amount of good faith money to put a check in with your contract offer. Your realtor can advise you on the proper amount for the home but even $500-$1,000 can go a long way. If a seller is entertaining multiple offers on their home and they have one that’s pre-approved, willing to pay the price and has already “shown them the money,” then they are much more likely to accept your offer over someone that doesn’t show themselves as well-prepared.
Work with a realtor
When you are buying a home, there’s no reason not to use a realtor. The seller pays all the realtor commissions. And, no, you won’t get the home cheaper by not having a realtor. When you work with a realtor, not only can they advise you on tips like the above, but they are also more in the know on what’s going for sale. Many homes are being sold just through realtor/office connections before they even hit the MLS.
I know it can be a bit stressful and overwhelming buying a home. That’s why I’m here. I have many, many years of experience and am happy to help answer your questions and be your fearless leader. Feel free to contact me if I can be of help with your Northern Virginia home.
Robin Butler, Your friend in the real estate business