Low inventory means higher prices, know as a tight market (sellers market). Attempting to purchase a home in this type of market can make the already complex process of buying a home even more overwhelming.
Here are 5 tips that can help buyers successfully get through a sellers market:
- STICK TO YOUR BUDGET. Before house hunting, get a pre-approval letter from a local lender. This will verify how much you can borrow. Then take in account the cost of ownership such as taxes, utilities and insurance. Buyers should determine a final budget they can comfortably afford. With fewer homes on the market here in Pensacola, bidding wars can drive up prices, so be prepared to walk away if the purchase price surpasses your budget.
- DESIRED NEIGHBORHOODS AND HOME WANTS VERSUS NEEDS. Buyers may need to compromise on what they want from a home, such as granite counter tops, hardwood floors, pool or stainless steel appliances, which can be added later.
- BE READY TO MAKE A DECISION QUICKLY. When you find a home that is within your budget and checks off your needs comes along, don’t hesitate – be ready to submit your offer quickly or you may risk missing out on the home.
- BID COMPETITIVELY AND LIMIT CONTINGENCIES. If the home is listed at market value (not grossly overpriced) you need to submit your highest & best offer with the fewest contingencies.
- WORK WITH A REALTOR. It’s important to work with a local Real Estate Agent who is a Realtor, a CRS (Certified Residential Specialist), member of the National Association of Realtors. They can give buyers the competitive advantage needed in a tight market.