The current real estate market is tough. Record high prices, interest rates, and low inventory make it increasingly difficult for buyers to get the property they want. However, you can still win in this market by positioning yourself correctly. Here are five tips to help position yourself to win while facing record-high prices and low inventory
1) Know your budget and stick to it
Knowing how much you comfortably able and willing to spend on a desired property is vital. This will help you focus your search and avoid wasting time on properties out of your budget. The National Association of Realtors survey data stated that the average down payment on a property from the middle of 2019 to the middle of 2020 was 12%. The percentage of the down payment increased along with the Buyer's age. For example, Buyers aged 22-30 years old were noted to have the lowest average down payment of 6%. Buyers ranging from 66-74 had the highest down payment of 23% on average. Being open to increasing your down payment could save you from missing out on your dream home.
2) Make a firm offer
When you find a property that you are interested in, it is essential to make a firm offer right away. This will show the seller that you are serious about purchasing the property and could help you win against competing bids. In addition, be sure to include a customized letter with your offer. As part of a firm offer, you can also prepare a personalized letter to go along with your bid. In your customized letter, highlight why you are interested in the property and why you think you would be the best Buyer for it. Cater to the seller's emotional attachment to the property by explaining why you are interested in purchasing their property. Thank the sellers who have lovingly cared for their property and communicate that you intend to do the same. Applying this technique will help your offer stand out from the rest and increase your chances of getting the property you want.
3) Consider all your options
There are many different ways to purchase a property, even in today's market. Some sellers may be interested in a cash payment. It's possible that the seller will more likely accept your offer if you state that you will make a down payment of 30-40% (or more) in cash. The benefit of this option is that you will save money on the overall mortgage by reducing the loan term and interest rate.
Some buyers may be able to afford the asking price of a property, but due to the current interest rates, they may not be able to afford the monthly payments. In this case, the Buyer may want to consider a longer-term mortgage, such as a 30-year mortgage, with a lower monthly price. Other buyers may be able to afford the monthly payments on a property, but not the costs, incurred upfront, such as the down payment and closing costs. In this case, the Buyer may want to consider using a home loan program, such as FHA, which will allow them to put down as low as 3.5% on the property.
4) Stay ahead of the competition
In any market, it is vital to be ahead of the competition. To do this in today's market, you need to know what you want. By clearly understanding what you want, you can focus your search and be prepared to make offers on the properties that interest you. In addition, it is important to have your financing in order. By being pre-approved for a mortgage, you will show the seller that you are a serious buyer and increase your chances of winning against competing offers.
5) Have realistic expectations
It is important to remember that you may not be able to get everything you want in a market like this. Sometimes it is necessary to compromise on certain aspects of a property to obtain what you desire. Be prepared to make compromises, and don't be unrealistic in your expectations. You can give yourself the best chance of winning in today's real estate market by following these tips.
At Ozark Realty, our Lake of the Ozarks Realtors perform outstanding agency services for buyers, sellers, and those conducting real estate transactions in the Lake of the Ozarks area. We strive to create long-term, sustainable value for our clients and customers and improve the quality of life in the Lake of the Ozarks region. Our core business provides superb transactions involving real property through leadership, experience, and knowledge.
If you are considering buying or selling a property at Lake of the Ozarks, contact Tanya Newberry at email@example.com www.lakeozarkrealty.com