Buyer Solutions for Today's Difficult Market
With a highly competitive sellers market, the Fitzpatrick Team wants to set clear expectations of today's market for our buyers. This might not be easy to swallow, especially for First Time Homebuyers, but the Fitzpatrick Team is dedicated to finding solutions before the problems present themselves. Here are our Buyer Solutions for Today's Difficult Market:
Problem: Slim Pickins’ (Low Inventory)
When inventory is at an all time low, and your urgency to buy is high, you need to be prepared to sacrifice some ‘wants’. Find the least expensive home in the best neighborhood you can afford and upgrade over time.
You might want to consider expanding your search. If your desired location is too competitive, expand your search and you might find some amazing gems in growing neighborhoods. Working with a real estate agent who really knows the area is the best way to find a home that fits your budget and lifestyle.
Problem: Financial Burdens Due to COVID
Everyone’s circumstances are different, but most of us have experienced some financial disruption since the pandemic started. The best thing you can do is speak with a mortgage lender to discuss your financial standing.
Problem: Multiple Offer Scenarios
In today’s market, you could be up against 5, 10, even 30 offers. Don’t assume that your offer is going to be the best -- work with the Fitzpatrick Team to make it the best. Click here to read our article on Winning Multiple Offer Scenarios
Problem: The Risk of Overpaying
If you’re going to buy a home in this expensive market, you absolutely must find out how much house you can really afford. Commit to staying within that budget amount no matter how much pressure you feel.
To feel confident about buying a home this year, follow these tips:
Limit your house payment to no more than 25% of your monthly take-home pay. This payment includes principal, interest, property taxes, homeowner’s insurance and, if your down payment is lower than 20%, private mortgage insurance (PMI). Plus, don’t forget to consider homeowner’s association (HOA) fees when preparing your budget.
Save at least a 10–20% down payment. A 20% or more down payment helps you avoid PMI—an extra fee added to your mortgage to protect your lender (not you) in case you don’t make payments. Anything less than 10% will drown you in extra interest and fees.
Problem: What You Want vs. What You Can Afford
We all have a vision for our very first home, but with the state of today’s competitive market, you might need to browse the market more thoroughly to better understand what you are getting at certain price points. Good practice: ask a member of the Fitzpatrick Team to set you up on an MLS Portal. You will be notified of new property that hits the market within your price point. This will help you understand the quality of homes suitable for your finances. Finding a home is often a compromise between what you want and what you can afford. If you have a champagne taste on a beer budget, you might want to expand your search.
Beating Cash Buyers
We are hearing that buyers cannot compete with cash buyers. However a non cash buyer can compete by committing to putting down additional cash if the appraisal comes in less than their offer price. This is known as appraisal gap coverage.
Buying & Selling at The Same Time
We can tell our sellers that as the number 1 team in our market we list more houses than anyone else. We will let our sellers know about upcoming listings before they hit the market.