It seems like any place you turn within the real estate market now, you’ll see one thing above all others: rising prices. This is the result low inventory due to a number of factors, including COVID-19 causing supply chain shortages. Some people believe a housing market crash is coming while others believe the opposite.
Should you buy a house when prices are high? Well, we still do. In fact we are buying more than we did before and we wanted to share some tips on how to buy in a sellers market if you’ve been thinking about it.
Buying a house in a hot market can be a battle between multiple offers. Low interest rates allow people to pay more for a given property because their payments will be the same. Where are the deals though? They are fewer and further between, but they are still out there for those who know where to look. You can still find good deals on the MLS (Multiple Listing Service) if you find a good agent who can help. Wholesalers in your city are businesses that find owners who need to sell their houses quickly and don’t want to deal with agents. Even as someone looking for their personal dream home, you can go directly to the sellers of those properties.
Find A Good Agent
Partnering with a savvy real estate agent who knows the market values where you’re house shopping is always a good idea. Realtors work daily with sellers and should have a firm grasp on what a home is worth in your given area. These professionals often work with lenders and other people within the real estate industry who may have deals coming to them. Your real estate agent should be finding you properties that match your criteria, and be willing and able to show you homes you’re interested in.
Give your agent a detailed list of what your ideal home features and be clear on wants vs needs. If you need at least three bedrooms and want a pool, they know they can still look for houses without a pool for your to consider . If you’re willing to take on a project home or something that needs a little updating that will help you secure a better deal as well.
Be sure to hire a realtor who will give you the full attention you need. When the market is hot, this is not the time to call your second cousin who got his license and has helped someone buy a property once. You need an agent who works full time and can dedicate resources to your search.
Wholesalers
Wholesalers, like realtors, work within your given market daily. A real estate wholesaler finds property owners who need to liquidate property “off market” due to personal circumstances or preferences. Buying a property through a wholesaler doesn’t come with the same protections as traditional real estate sales with an agent and typically involves a non-refundable deposit to secure the property. Wholesalers will have properties available for purchase that are being actively advertised to other buyers and investors. Unlike the MLS, there is no single centralized location where you can look at everything available in your market so you will need to seek them out individually to get added to their buyers list to see what’s available. There are some wholesalers who have dozens of properties at any point in time and others who have one a month so be prepared to connect with several to expand your options.
Buying through a wholesaler is a good strategy if you would like to find a home quickly and have cash to spend. As investors, we often buy from wholesalers ourselves.
Direct To Seller
An often overlooked method of buying a house is going directly to the seller. That friend you know that owns the house you’ve always loved? They could sell it to you just as easily as anyone else when it’s time for them to move. Title companies and, if needed, real estate agents can help with these transactions and generally charge less given that the buyer and seller have already agreed to many parts of the transaction.
This strategy allows you to have more control over the process and can lead to you finding your dream home “off market.” Unless they have already listed is as FSBO (For Sale By Owner), it may require patience as you wait for the owners to decide to sell. Be sure they know who you are and that you’re interested when the time comes, and follow up every once in a while.
Buying a house in 2022 doesn’t need to be a nightmare of rejected offers and emotional turmoil. Working with a smart Real Estate Agent can find properties that are still undervalued. Wholesalers in your market can be a golden opportunity if you have cash to spend. Working within your friends, family, and associates can often yield great results when searching for a home. Each of these methods may help you in your search for your dream home.