I get the same question fromÂ home buyersÂ I meet in Redwood City. Here is the answer to their question including Â how you can plan out a system to buy your new home. Â I hope you enjoy the information and find it helpful. Â Now the question:
Plan For Buying A Home
Q:Â I've been looking for a home for a long time. In my price range, it seems like there are only sub-standard homes for sale. When I began looking for my new home, there were lots of houses to see. Â Although they was a big challenge because so many other buyers were trying to buy them at the same time like me. Now, it seems like those same old "crappy" houses that no one wanted before are what is left for sale.Â When a good house does come on the market, it sells quickly. I'm getting frustrated and angry, and I am beginning to think I should give up my American Dream of owning a home. Is this all in my head or is there a solution?
A:Â You are correct. Today's homes choice is slim. I'm no Einstein, so I can't say I know empirically why inventories seem to be stagnant and undesirable, but they are!Â This is one of those delicate values we see that you can't interpret by looking at hard data -- the number of homes on the market are heading down, but the reality is that much of what is out there seems to be the same homes for a while. Â REO's are the ones today, which are new inventory. Usually that means the homes lost most of its "pride of ownership" it was accustomed to when times were better.Â If you do like an REO home you have to endure an extended time for the negotiations with a bank prior to closing any escrow. Â It's running an extra Â 83 day currently.
Being aware that other indicators like days on market (DOM), and number of homes on the market, don't really give you a true picture of the real estate market either. The homes that don't "pop" when you walk into them stay on the market longer, but the ones everyone loves sells right away. Â Because of these extremities you get a results, which can be tainted from a normal market analysis.
Change Your Thinking
It's time for you to recall why you decided to buy a home in the first place. What was the dream of home ownership you had when you start the home buying process? Â Was it for extra bedroom for your children? Â The chance to entertain the way you wanted to entertain? Were you motivated to buy a home in a buyers market so you could take advantage of the market?Â When you do get frustrated or think you should give up, simply revisit your original goals. Â This will help you remember why you started your home buying process in the first place!
If your original reasons for buying a home Â inspired you, they'll once again guide you through your times of thinking about giving up. If your reasons aren't inspirational, then you might be better off deciding to wait. Â You can always revisit buying a home at a later date: If you aren't motivated or have a strong sense of urgency itâ€™s likely you probably won't ever find the home of your dreams. Today's real estate market require a commitment from a home buyer who is serious. Buying a home is hard work and waiting and seeing is not a game plan.
If you do decide to get out of the home buying process, be aware of the consequences by giving up. There's all sorts of "Gurus" discussing where prices and foreclosure trends are going in the near future, however, there's agreement with almost all of them that interest rates are going up, along with lending guidelines getting even tougher. So buyers have to "qualify" for a loan before a bank will fund a mortgage...imagine that!
If you decide to move forward, it's important to get clarity on what you want, and be more committed to compromising on things that aren't your strong "must-haves". Focus on what is truly important to you and be open to possible different scenarios that could work for you in the long run. Â Even though it may not be the decision you want to make today. For example you may only want a "move-in" condition home, however, you haven't found it yet. Maybe buying a fixer-upper at a discount might be better. Â You plan to use your tax-credit funds to do the fixing up, Â like new painting, new carpeting and other cosmetic finishes that can show off your future diamond in the rough.
A good number of my clients feel the same as you may be feeling and they too seem to just be treading water. They grow more worried and impatient when they can't find that special home that they want.Â When a house does come on the market for sale they still hesitate before making an offer even if it would fit their criteria for their home. If that's you, here's some advice: Quit hesitating or stop looking for a home!
When you see a place that would work for you, make an offer -- just do it! Do it decisively and quickly. Don't worry about the small stuff like pinching pennies or agonized over spending money for something you want -- be forthright and aggressive in your timing and your pricing, and you'll have a better chance of success. Nickel and dime a seller and they will nickel and dime you back. Make an acceptable and fair offer that will make the sellers and you have a warm fuzzy feeling in your tummies and everyone will win. If you do that, you can be firm with your negotiation to purchase your home because you have given an honest and fair offer. By being fair and forthright you will get your new home. Once done all your worries, anger and frustrations will be a thing of the past.
What You Must Know
If you want to be fair without overpaying for a home, make sure that you and your agent study the MLS statistics in an intelligent way. When you look at the comparable, look at homes that are very similar to the home you want to place an offer on -- not just in sizeÂ or bedrooms and baths count, but look at the exterior curb appeal, the various upgrades and your level of appeal. When you analyze these homes, check the list-price-to-sale-price ratio: How much did they all sell for compared to what they were listed for?
This can help you understand that particular neighborhood -- this in turn helps create a comfort level about what to offer whether it is more than asking or indicates limits so you don't offer too much. Â
1. Revisit your motivations and reasons for buying a new home in the first place. Commit to the home buying process or decide to stop looking for a home, with a full understanding of what you are giving up.
2. Be fair and decisive and move quickly to make a strong offer, when you find a home which would meet your needs and criteria for your new home.
3. Be ready to compromise or use a strategy that will still carry out your original goal of owning a home, and plan to put your tax-credit money to use by fixing your new home so it is the American Dream you have always had since a child.
As always if you need help or have any questions Cliff Keith and Team are always here to help you. Â You can reach us at 650-346-7366. Â We would love the opportunity to help you.