According to a research conducted by realtor.com, there has been an increase on the number of homes coming into the market since the beginning of this year.
Most sellers aim to list homes in the next six months and about 10% of them seem to have already made their properties available in the market.
This may sound good news to many, and it is. However, as much as there are more people listing their homes, the number of buyers is also growing fast.
Based on the Realtors® Confidence Index by the National Association of Realtors® (NAR), the time that each home spends on the market has decreased. Homes are selling faster today than they did in the previous month.
If you are thinking about buying a home in this crazy market, here are 5 secrets that you need to know:
Secret Number 1: You Want to Hire a Realtor® to Work for You
Let's say, you're at an Open House. You've decided not to bring a Realtor® with you, and you fell in-love with that property. If you go ahead and talk to the agent that's at the property that has the listing, by law, they must work in the best interest of the seller. They cannot work on your behalf.
Now, let's say, you don't necessarily like that home, and you want to see a couple of other homes around the market. Maybe something down the street or something that you've seen online, so you start talking to the agent at the Open House and you say, "hey, can you show me those homes?"
Regardless of what company they are listing with, any agent can show you any listing that's on the MLS. However, if you haven't hired that agent to work for you, they MUST still work in the best interest of the seller even if they don't know the seller, even if the listing is not theirs, even if they have never met the seller, even if they have never been at that house before - they must work in the best interest of the seller at all times unless hired by the buyer to work in the buyer's best interest.
So don't go shopping for a home without hiring a Realtor® first.
Secret Number 2: There's a Difference Between a Pre-Approval and a Pre-Qualification
A Pre-Qualification we don't see much of these days because they are not worth the paper they are written on.
It actually does make a difference what lender you go to, to get your Pre-Approval. Especially, a local lender versus some online lender. Whenever I see a Pre-Approval come across on somebody who's looking to make an offer on one of my listings, I check to see who that lender is, who the bank is, what their qualifications are, how experienced they are, and what percentage of their deals are actually closed. You want to make sure you get a Pre-Approval that's been fully underwritten by a local, reputable lender that you know without a doubt you're going to be able to get that loan.
Secret Number 3: Make a List of Your Needs & Wants and Know the Difference
Let's say, you're looking for a 4-bedroom, 2.5-bathroom home with granite countertops, hardwood floors, stainless steel appliances, in-ground pool in the backyard, new central air-conditioning, new roof, new windows, and new siding, I guarantee you, that home is not going to be available because if I find it first, I'm going to buy it first.
There's a difference between what you want and what you need. Your needs are things such as: the location or school district, how many bedrooms, or bathrooms you need. I grew up with mother, father, sister, and myself in a 3-bedroom, 1-bathroom ranch on a slab. We don't really need 2 bathrooms. Some people would say, "oh, I can't live with 1 bathroom these days."
Is it a need or a want? Is the pool a need or a want? What can be added to that property easily after you've purchased it? Because it's not a need, it's more of a want.
Going in with a list of your needs and your wants and determining the difference between both can help you make that decision faster and get that offer accepted above anybody else's.
Secret Number 4: Don't Play Pricing Games and Expect to Pay Your Closing Costs
Especially in this market, if you have a lender or any agent telling you that they can do what is called a "Seller's Concession" to include your closing costs into the loan, it's not happening. Not with the amount of demand that's out there and limited inventory. I don't see that happening anytime in the foreseeable future, so be prepared to pay your closing costs and don't play games when it comes to the offer. We need to go in with a strong offer. We need to go in with your best and highest offer right off the bat.
Right now, you have to look at the listing price as the starting price on a home, and how much higher are you willing and able to go above that listing price. If you lost that property because somebody did another $3000 to $5000 to $7000 over the course of 30 years, that's going to change your payment just by dollars per month. Do you really want to lose that house because you wanted to save a couple of bucks when making the offer? You got to look at the 30-year cost, not just the price of the home.
Secret Number 5: Know Your Budget, Be Realistic, and Be Ready to Act Fast
I did the numbers for the entire homes for sale in Suffolk County and a couple other local markets such as homes for sale in Patchogue and homes for sale in Longwood School District. Homes are disappearing "the day they hit the market", within about two weeks. Check out the May 2022 Housing Market Updates by expert Realtor® Kelly Kelly below:
I hate being the guy that says you've got to act now. Reality is, if you don't act now, somebody else is going to. The home that you saw today and want to think about tonight, somebody saw yesterday and thought about last night. As a buyer, you must be prepared to act fast and stay within your budget.
For the sellers, the inventory could be creeping up, however, this is not a sign of a crash. This is a sign that it's starting to get a little healthier. We're starting to plateau a bit. It's still a sellers market since we have less than 6-7 months of inventory. What we're seeing right now is just a slower rate of appreciation because we're used to seeing about 20% of returns year-over-year. Right now, we're seeing about 8% to 10% returns on investment, which is still great.
If you need assistance or simply want to know about your best real estate options, let's talk!
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