In a seller’s market (very little supply, greater demand) real estate agents often tell buyers they should expect to make multiple offers before one is accepted. Disappointment has become the new normal, and it’s placing significant stress on first time buyers. Especially millennials. As recent research suggests that approximately 60 percent of Millennials choose to rent rather than own.
If you’re in a predicament where you’d love to purchase a new home but are afraid of constant rejection, why not follow these tips as they’ll make the bidding process easier.
Define Your Needs
Start by defining what you need in a home and neighborhood. Your primary focus should be the neighborhood, as a home can be changed but a neighborhood can’t. When you’re defining your needs be flexible and work within your budget, and your needs. Think about your how long it would take you to travel to work or a business district each day. How many rooms would you need etc. Now that you have this information the search becomes easier.
Check Your Credit
Take advantage of free credit checks offered by the credit reporting agencies. And then either dispute questionable entries or focus on cleaning up negative entries. At the very least, be prepared to offer clear and cogent reasons for any late payments that appear within the last couple of years. Pay down credit card balances and student loan debt as much as possible, and assure that your employment record is stable.
Save For Your Down Payment
Before you enter the housing market as a buyer, start saving. It will likely delay your search as you’ll have to make lifestyle changes but having a reasonable down payment and closing costs is the smart move. This would also count in your favor when you’re applying for a loan as you’re demonstrating that you can be financially consistent.
Get Valuable Advice From A Loan Officer
Get a definitive idea of how much you can comfortably afford. If you’re a veteran or qualify for other special loan programs, find out in advance. You’ve also got to consider interest rates. They are currently low, but any rate change will affect the amount you can borrow. Therefore, limit your search to homes priced lower than your loan limit.
The only thing better than a pre-qualification letter is approval confirmation for a specific loan amount. In a fast-paced real estate market, seek that pre-approval, so that you’ll be able to move quickly when you find the right property. A pre-approved loan, an offer with no contingencies, and a quick closing date are the marks of an “A-list” buyer.
Make the First Offer Your Best Offer
In a seller’s market, it’s wise to make the initial offer your best offer. A lowball bid will not impress the seller, and you may never get a chance to submit a higher bid. When there is serious demand for homes, it’s better to be serious about every offer you make.
Finally, know that if you’re persistent and prepared, you will find your ideal home. However, it helps to have a trusted real estate professional by your side, so why not get in contact with us to see how we’re able to help with your search.