7 Common Concerns Home Buyers Have and How to Conquer Them
You have likely heard tons of rumors about low inventory, rising mortgage rates, and high prices. How do you separate the real facts from the "exaggerated" ones? Should you really be worried about finding a home to buy in this market? Spoiler alert: the answer is no. In this post, we'll go over seven common concerns home buyers have right now, and how to overcome them to secure your dream home.
Worry #1. I am afraid to be in competition with other buyers
Great news! Most homes sold in Dane County in Q1 actually did not have competing offers! This is based on sold we data pulled from the South Central Wisconsin MLS.
Worry #2. Inventory is low and I'm afraid it will take a long time to find a home that I like
Yes, inventory is low right now. But, 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 offers above the asking price. Less homes have been listed for sale each year in Dane County since 2020, and there will likely be even less next year. There are ways to get ahead of the competition though. It's free to hire an agent that will work proactively for you and watch for listings that are "Coming Soon" and haven't hit the market yet. Also, the home search process may not take as long as you think. For Dan Chin Homes' clients so far this year it took just 70 days on average from the moment they hired us to the moment they received an accepted offer.
Worry #3. Most homes are selling over asking price
This is the case in many markets, however it is a flawed metric. Many homes are being listed lower on purpose right now, in order to create a bidding war, so this impacts those number as well. This is the new norm, and it just means we have to approach things differently than we did in the past. Instead of expecting to pay less than asking price, we should adjust search criteria and expect to pay at or above asking price.
Worry #4. Homes are selling fast, so why bother?
Yes, homes are selling fast, however this metric has stabilized over the past year. Instead of two weeks on market, homes are now selling in more like one week. Plus, most of the homes that are listed have offer deadlines, which are made so that everyone has a chance to see the home before submitting an offer. If you are working with an experienced, aggressive agent, then you know about homes with plenty of advanced notice.
Worry #5. If I sell, I won't have a place to go
Typically you are buying and selling in the same market, whether it is up or down. You should focus more on whether or not this is the time to change your quality of life, instead of the timing of the market. An experienced real estate agent will be able to work in contingencies to give you all the time you need to find a home, all while lining up your timelines to work perfectly for you. The majority of our clients are selling and buying at the same time, and out of 300+ clients a year, nobody has ever gone homeless!
Worry #6. Mortgage rates are going up
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 same home you are interested now will cost even more next year. The longer you wait, the less affordable it will be to move.
Worry #7. I should wait until the market crashes to buy
People have been saying this for years, but the facts don't point to the market crashing like it did in the mid 2000's any time soon. Protections have been put in place to prevent a future crash. Appraisal processes have become tighter, and lenders are spending more time vetting buyers before pre-approving them. You could be waiting around for nothing.
Tips for a Home Buyer in Today's Market
Hire a Real Estate Agent
Nobody should tackle this real estate market without an experienced and aggressive 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.
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.
Don’t Give Up!
Trust us. We know how frustrating this process can be. After being outbid a couple times, 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.
It may be a bit hectic in today’s real estate market. But the good news is, with a bit of preparation, patience, and guidance from a real estate agent, you’ll be on your way to having an offer accepted so you can buy a home in no time!
For more expert real estate advice, browse our blog below!