5 quirks to watch for when buying a home
Home buying is a journey, for some it's a sprint, but for most it's a marathon. We’ve found that even though there are over 17,000 homes bought and sold each day in the United States, no home purchase journey is the same. Each comes with their own story, so here are 5 quirks to keep in mind when buying your home.
#1. You're Buying From an Individual Not a Company
Every seller is different and with different rationale and while you try to meet your goals, they’ve got ambitions of their own. Even with an accepted offer and an agreed closing timeline, between moving schedules and audibles, changes can occur along the way. You should remember, you're not buying from a company where you can expect level set standards. You're buying from a person who is likely selling their largest financial asset and you're buying yours. As an eventual owner, your intention may be to collect as much information from the seller as you can, but many may provide little knowledge. They may have never lived in the home or may not want to mislead you.
How to win:
Don't feel tied to any one home. If a seller is not cooperating, feel free to move on. Be ready to make business and personal decisions and know that with any home purchase there will be some risk involved. Ultimately, it is an investment. Nuhom will extract any information it can and provide guidance about a home of interest.
#2. Offers are Made Silently
You’d think given the massive size of the real estate market that there may be more transparency with how offers to purchase are made. Unfortunately, it's not like the stock market where you can see pricing for every stock and make quick decisions with the click of a button. As it stands, you won’t see what your competitors offer. Offers are made behind closed doors (actually they are emailed directly to the seller agent). It’s typical to have to submit an offer without knowing what you’re truly up against. Seller agents leverage the offers in hand to benefit the seller where possible and buyers are requested to provide their ‘best and final offer’ without being provided any new information.
How to win:
When making an offer on a home you can see yourself living in, put your best foot forward. Stick with your belief on the value of the home and stay within a manageable budget. Don’t let what may or may not be happening with other offers lead your decision making. Nuhom will uncover any guidance (if any) on competing offers along the way.
#3. Timing Is Everything
Buying a home can be serendipitous and timing is everything. There is no “right” amount of time it takes to complete the process, it could take a week or it could take months! It’s like musical chairs, the right home may not pop on the market for weeks and then all of a sudden it does. Regardless of how long it takes, buying a home comes down to making an offer once you find the home for you. Without that you’ll never know what the seller’s appetite is.
How to win:
#4. Know Your Market
When browsing homes it’s important to know your market. During the pandemic, everyone has been saying it’s an even stronger seller’s market, is that the case with the home you’ve found? Not every location and type of home has exceeded expectations. For example, in 2019, 4,376 Boston condos sold with an average price of $920k, but in 2020 that dropped to 4,156 condos and $862k respectively, an 11% decrease in price. So while everyone was touting a red hot market, it wasn’t really too hot in the City for condos.
How to win:
Group think may play a role in your thinking. Know the market you’re interested in. It may be that your seller needs a cash buyer or a particular buyer who is willing to overlook issues at the home. This creates an opportunity for you and you may have more leverage than you think.
#5. Competition is Real
Real estate has a way of becoming very competitive, after all there is only one of that particular home. There aren’t identical ones coming off an assembly line. Because of this, with ‘hot homes’ home buyers will increase price and include little to no stipulations or contingencies in their offer.
How to win:
People talk about how much a home went over the asking price. If it went over by $100k, the truth is the asking price was artificially low to begin with. The seller agent does this to create a rush of buyers and eyeballs to the property. Homes should be priced based on what the market has been willing to pay for a similar home, not necessarily what the asking price is.
When you drop contingencies, understand the risk you are taking on. Is it real risk or has conventional wisdom led us to believe it is? Based on sold homes nearby, Nuhom will provide you custom pricing guidance on your home of interest and you can make an offer with the best information at hand.