I've been in the Real Estate business for the past 11 years. And of course this is the worst real estate market I've ever been through.
I was told about the bad market in the early 1980's, but completely missed it, even though I lived through it. 18%+ interest rates, and low selections. My excuse was that I had no housing needs. We were comfortable in our home and life was good.
I think that is where most people are with this real estate market. Missing it. Either they just don't care or if there is a need for a home change, they are struggling with what the TV media is putting out there.
Ask your local Realtor, Heck ask me. I can give you all the stats on the Real Estate Market. Its a Buyers Market.
What does that mean? Buyers Market; when the buyer has an advantage over the Seller. e.g. Market is swamped with active homes listed. There's so much more to it than this, but you get the idea. The buyer has the ability to choose from many different homes, prices and areas.
But, the market is showing some changes right now. Especially in the lower price range homes. With the market flooded with foreclosures, and lower priced homes, there comes the investors. Sellers also see this as a buyers market and are deciding to not place their home on the market as well. How can they compete with the low priced foreclosures down the street?
Investors in the mix, they drive prices up. So it's a bit hard for a buyer to purchase a lower price home. When the investors place a bid on a home it is usually 5-15% higher than the asking price, knowing that they will make money on the home when they are ready to turn it in several years. The average buyer on the other hand, usually wants to make bid on the asking price or even lower. They want a deal. Who doesn't.
Well I'll tell you right now you are getting a deal already. These prices are typically lower now than they have been in many years. So, if you want that home you may want to consider upping the bid some, especially on the lower priced properties.
Have your agent do some comps on the homes you are interested in. If they comp out higher than asking price, you have room to bid up and know that you will probably have some built in equity. Your agent is your best friend. They are looking out for you and your purchase. Trust them.
Another bit of advice is to get pre-approved for your loan. Unless you are paying cash, you will need a loan. The process is a little tougher than in the past, but it is very doable. Most lenders or agents can advise you on credit repair or direct you to someone who can. And you will need your down payment and closing costs before you start looking.
The worst thing for you would be to find that perfect home and not be able to put an offer on it just because you did not get pre-approved, or you still need to save a few more dollars. Being prepared is most important.
Contact your agent and go through the steps with her/him. Contact a lender or two. Ask about rates, payment, how much can I afford, etc. But most of all be prepared.
Oh, another bit of advice. When you pick an agent or lender stick with them. Listen to their advice and do not go shopping without your agent or the approval of a lender first. And definitely do not let the sellers agent help you. The sellers agent is working for the seller not you as the buyer. That agent is trying to get the best possible price and deal for her/his seller, so don't let the seller agent talk you into anything.
I hope this advice is helpful. You can contact me for more advice or details.
