Friends and relatives are always trying to offer advice. Once you're in the market to buy a home, you'll see this tenfold. However, some of the tips you’re being given don’t really apply to our current market. Therefore, today I'm going to share with you some outdated home buying advice you should disregard.
“You should wait until prices decrease.” We’ve been in a seller’s market for some time now, which means there's an excess of buyers and not enough homes. As a result, prices have gone up as people compete for listings. So while this tip you may be receiving has some validity to it, my argument is this: Rent is also high. In almost all cases, you’ll find that renting is more expensive than paying a mortgage, and paying rent means you’re not building any equity. On top of this, interest rates are still historically low. If you decide to wait and miss out on these rates, you’ll likely be paying more later on.
Renting is more expensive than paying a mortgage, and paying rent means you’re not building any equity.
“You should make an offer with room to negotiate.” In today's market, this doesn't work so well anymore. Homes are selling close to or even above list price. Plus, with multiple-offer situations occurring on many properties, you likely won't hear a response if your initial offer isn't a good one. Have your agent compile a list of sold comparable properties for you and see what the market value is. If you're continuously not hearing back from offers you've submitted, you may run into buyer fatigue and resign yourself to renting for the foreseeable future.
“You should wait for spring.” Right before the spring market begins is the best time to be out there looking at houses. By waiting until spring, you’ll be competing with more people than you would be now. So, if you can find the right property now, take the opportunity and avoid springtime competition.
“You should make an offer right away.” Yes, it’s important to get an offer in quickly, but you still need to have a comparable market analysis to show that what you’re doing is a good idea. This will protect you in case the home doesn’t appraise or big problems turn up during an inspection.
That's it for the top misguided homebuyer tips of 2019. If you'd like to learn more about the home buying process, feel free to reach out to us.