This year, the U.S. housing market has become one of the strongest seller’s markets ever. As a result, buyers have experienced a lot of competition over not a lot of inventory. So how are you supposed to buy your dream home with countless competitors making offers? For starters, avoid these 5 home buying mistakes commonly made in a seller’s market.
- Hiring an inexperienced agent: In a seller’s market, your agent is vital to help you stand out from the competition. You see, many homebuyers consider a real estate agent to be useful only for sellers, but this simply isn’t true. With an experienced agent assisting you through the home buying process, you not only have a better understanding of housing inventory, but also have the necessary resources to make a tempting offer to the home seller.
- Shopping for homes without getting pre-qualified or pre-approved: Although you may have the credit score, financial backing, and documentation to get approved for a mortgage, a home seller will not know this unless you provide proof - and mortgage pre-qualification and/or pre-approval is the proof you need. But what’s the difference between pre-qualified and pre-approved? Learn more about the two here.
- Waiting to make your best offer: In a seller’s market it’s important to make your best offer your first offer. Don’t wait to see if the home sellers will lower their price or go for anything below their asking price. There will likely be several other buyers looking at the home, so you want to get it off the market with a good offer as quickly as possible.
- Not saving for a bidding war: Although you want to make the best offer as soon as possible, this does not mean you should offer all of the money in your home buying budget. With countless competitors also likely making offers, you may need to participate in a bidding war. For this reason it’s important to look for houses slightly below your budget range.
- Going over budget: In a highly competitive housing market, it can be tempting to simply go over budget to speed up the overall home buying process - but this can lead to mortgage stress in the long-run. You took the time to set a budget, so stick to it! Eventually you will find the home that’s right for you.
By avoiding these 5 home buying mistakes, you’re bound to be more successful in your search for the perfect home. For more information about home buying in a tight housing market, or to learn more about transitioning into homeownership once you make that purchase, contact one of our mortgage specialists and download our new ebook today.