The U.S economy is projected to experience a 2.0% growth throughout 2017. Only 62% of new homes, together with existing residential properties, were regarded as affordable to the average American in 2016. Now, what about for our current year? Well, the rate of home prices rises by about 5% yearly, which means the percentage of these homes (in the affordable price range) will further decrease year over year as prices go up (especially in a market that appreciates like Charleston does).
The numbers signal an obvious hike in home prices, leaving middle-class folks with a huge challenge when thinking of bidding on a home in a hot seller’s market so they can avoid making costly mistakes. However, by understanding the shortcomings of many buyers in real estate markets, you can save significantly and make the most efficient decisions for you and your wallet.
Here are a few items to be aware of if you’re looking to buy in a hot seller market:
- Taking Action Out of Desperation
It is challenging to overcome the disappointment that sets in when you see a home moved from the “new” class to the “awaiting approval” category. At the back of your mind, always remember that acting out of desperation can vastly compromise the transaction.
Unfortunately, desperation always tends to increase the probability of someone making irrational decisions (no matter what the circumstance is). Such instances can include either negotiating on a home that maybe does not meet your true preference or paying more than the property is worth. By duly researching on the available homes you continually gain useful insights regarding the purchasing process,enabling you to decide what amenities you require in your future home. A great realtor will also be able to vastly help you in understanding the Charleston market and position you for success.
- Lack of “On-Call” Preparedness
As it’s name suggests, hot sellers’ markets will see the sales of houses go at a fast rate, with most properties appearing in the “listed now” list to the “under contract” list. With many shoppers in the market, you need to always be ready to seize the opportunity to have a grasp of attaining your dream home.
- Bypassing Market Analysis and Trends
Most people make the resolute decision to buy independent of what’s happening in the seller’s markets. On another token, it is critical to make real estate decisions based on your current family status, and what it will be after five years. If you’re only thinking about your current conditions, things could change in the next couple years; whether that’s maybe your job or possibly concerning items pertaining to your family like education opportunities.
Now, ignorance may be bliss, but burying your head in the sand on the buzz going around in the markets could result in you losing out on great deals on some beautiful homes. That compels many to lose control of the situation and throw every last dollar on the next house they see, whether or not it fits their taste. Being prepared and thinking smart in this step will help you vastly, which is further reason to work with a great and knowledgeable realtor.
- Hesitating to Bid
Readiness for an On-Call deal could at times mean that you miss the chance of visiting the property without making an offer. Any great realtor will be able to offer a virtual walkthrough or videos for home sales, so you may have a sneak peek of what the house has to offer. Making an offer marks the start of the buying process, and it is recommendable that you make an offer and view the home instead of solely seeing it enlisted as “under contract.”
- Foggy Financial Plan
Avoid trying to juggle all the financial numbers in your brain. Make sure to verify all the income you’ll be receiving in the future, your loan payments, and all your utility bills by coming up with a financial figure (ahead of time) that you will be comfortable paying duly for a future home. Real estate matters have significant financial implications, and it is only by having a clear mind on what you can afford that you will be able to succeed.
Sometimes, you may be required to hike your price range on a whim. If you are new to the market, your realtor might be able to enlighten you on tax breaks which can assist you financially. If they can’t directly, they will likely be able to connect you with someone who can.
The demand for new homes simply keeps rising, and people sometimes make bids before even viewing the home to win over other buyers. Be sure to avoid the above mistakes and raise your chances of landing a great deal on an amazing home in Charleston.