Tag Archives: real estate market

6 Tips for Buying in a Seller’s Market

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Buying a home in a seller’s market doesn’t necessarily have to mean paying too much, giving in to seller demands, or difficult negotiations. Even when sellers have the advantage, they may still need to work with a buyer to sell their home.

Some homes will often get plenty of attention while other homes may sit because they are priced too high or because of any number of factors that are undesirable to buyers in their market. With this in mind, it’s possible to make buying easier, even when the market favors the seller.

1) Be Firm but Fair in Negotiations

No matter what the seller may be asking for their home, the home still has a fair market value. While the amount the seller may be asking for a home could be a little bit higher in a seller’s market, that doesn’t mean a buyer can’t negotiate the price. Remain firm in negotiating, but also be fair based on the market conditions. A real estate agent can be your best resource to help you determine what your options are when it comes to making an offer.

2) Take a Look at Homes on the Market For a Long Time

Even in a seller’s market, there will be homes that just aren’t as popular as others. These homes will stay on the market longer, and finding out why this is the case, might be the beginnings of a great deal. If a home has a characteristic that isn’t popular with many buyers in the area, but it doesn’t bother you, it may be possible to buy a home in a seller’s market for less than you might expect.

3) Remember, There’s More Than one Location

Location is very important, but there’s generally more than one specific street or area where a buyer might want to live. By looking in several different places you might find the home that’s right for your needs without being completely tied to a location where the sellers may be less willing to negotiate and the prices might be above budget.

4) Find the Motivated Sellers

There will always be some sellers that are more motivated than others. No matter the reason for their motivation, the opportunity exists for buyers to get a good deal on a home they love. It may not always be easy to find sellers that are highly-motivated, but an agent can often help locate sellers who are looking to move their properties faster, and for a lower price.

5) Be Prepared and Ready to Negotiate

One of the ways to get ahead as a buyer in a seller’s market is to make sure your finances are ready. By having a mortgage pre-approval letter and a strong down payment, it’s possible to get ahead of other buyers who may not be as prepared. Sellers want to work with buyers who are serious and have a high probability of completing the transaction without delays.

Not being ready before making offers could mean missing out on a home that would be just right.

6) Don’t Underestimate the Power of Cash

Buyers who pay in cash and don’t need a mortgage to purchase a home often have a better chance being ahead of other buyers in a sellers market. Cash can be very attractive to some buyers, because when it comes to buying a home, it shows a seller that they don’t have to worry as much about a deal falling through because of mortgage finance issues.

When buyers don’t need mortgages, the transaction may be completed a lot faster, too, making it easier for everyone to moving on to the next phase of their lives. Speak to a financial professional to see if this would be a prudent move for your long-term financial health.

While a seller’s market can be a bit tricky to navigate, home buyers should know that with enough preparation and effort, they can find and purchase their dream home without adding additional stress to the process.

By our guest blogger,_KrisLindahl_481224369

Kris Lindahl REALTOR® CRS CLHMS
The Kris Lindahl Team at RE/MAX Results
2407 109th Ave NE Suite 110
Blaine, MN 55449

www.krislindahl.com
twitter.com/krislindahl
linkedin.com/in/krislindahl
www.minnesotacommercial.com

 

The State of the Union: Real Estate Edition

state of the unionYesterday, the National Association of Realtors released their quarterly report regarding the statistical news of existing-home sales. It has shown that while we have been on a gradual upswing as of the past three months, our summer season ended with a definite decline come August. Now, this news is not to be taken as bad news; there has not been anything terrible happening in the market. We are seeing definite improvement from last year across the board. However, there has been a stall in the constant increases we’ve been experiencing nationwide.

If we break it down by region, the only one that hasn’t had a change in existing-home sales at all from July is the Northeast. The mid-west declined 1.5 percent, the South was down 6.6 percent and the West down 7.8 percent. These numbers may seem to be cause for concern but all of these regions have an average of a 6 percent increase from last year.

Now these statistics aren’t real estate sales across the board. To be clear, existing-home sales according to the NAR consists of completed transactions that include single-family homes, townhomes, condominiums and co-ops. These sales have fallen 4.8 percent from July, but as a yearly average, they are 6.2 percent above a year ago. I know, it’s a lot of numbers.

Experts are saying that the reason for this stall is a lack of inventory in areas like the South and the West. This has caused the prices for said homes to spike drastically to capitalize on the lack of supply to demand. NAR chief economist Lawrence Yun states, “With sales and overall demand higher than a year ago and supply mostly unchanged, low inventories will likely continue to limit options for those looking to buy this fall even with the overall pool of buyers shrinking because of seasonal factors.” Basically, the lack of new home construction isn’t reflecting the needs of those in various areas. This increases prices, which has been the issue for the stall. Thankfully, the price appreciation for the limited supply of homes have begun to come out of the unhealthy growth rate and started to even out, which is good for the overall sales.

But rather than end this post on a bad note, here’s something to keep in mind as we head into the next quarter: As our job market continues to improve, it will trickle down to wage increases. This will increase homebuilding and improve home inventory, which will continue to slow down price increases. So in the end, it will all even out. Guess we’ll just have to see what the next quarter has in store…

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To Dig or Not To Dig

 

backyard home improvments
Outdoor space

Summer is upon us and with that come lots of fun outdoor events. BBQs, pool or garden parties, hanging out around the fire pit…all of these are staples in the summertime. And they all take place in the same area of a home. They all center around the backyard.

While most home buyers are first drawn by a home’s curb appeal, careful planning needs to be given to the backyard landscape. There are so many really great developments being made to today’s backyards. From elaborate pool settings to lavishly grown gardens, it can be difficult to decide what to do with the back end of a property. Here are just a few things to consider when tackling this project:

Having a list of wants is a great place to start. Are you going to focus on a garden? Then you’ll want to consider which flowers, shrubs & trees work well with your environment. Do you have an aquatic family? Then safety precautions, like fencing, will also need to be considered. Having a list of everything you’d like to have will also help you not only budget out the space, but also upkeep time and cost. Make sure you check out zoning requirements too. It would be awful to plan your dream yard only to find out that your community doesn’t allow it.

Once you have your plan in place, it’s time to get to work. But before you jump in head first and something goes terribly wrong, consider a professional to handle this portion of the work. They have added knowledge about what will work well and what won’t. They will know which plants are favored by local wildlife. They know how to build the pool or water fixture properly. Their knowledge will not only make your yard beautiful, but it will save you money in the long run.

And finally, the budget. While we may want everything but the kitchen sink in our little outdoor sanctuary, being a bit more realistic is definitely in order. A professional will generally say spending 10 – 20% of a home’s value is ideal, but will fluctuate based on what you already have established and what you’d like to change. Checking the latest Cost vs. Value report will give you a better idea regarding resale expectations. After all, this will be a focus upon selling the home. Make the most of it.

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Rent-to-Own Isn’t as Easy as You May Think

_tma_Rent-to-own

Today I ran across a fact about current housing market that made me stop in my tracks. Homeownership is at its lowest in 25 years. Wait, excuse me? You must have your facts wrong, sir. We can’t seem to slow down this incredible surge in today’s market! Unfortunately, I was mistaken. And the reason behind it is not what you think.

According to the U.S. Census, the rate of homeownership fell to 63.7%, a rate that hasn’t been matched since 1990. But if housing demand is rising and pricing is rising, why isn’t homeownership? The upswing in the economy is actually having a reverse effect on the housing market. Hold on. Let me explain…

Because there is a rise in the economy, there are more millennials moving out of their parents’ homes and into a rental property. This increases the demand of rental properties. In fact, rental vacancies are at an all-time low. The more demand there is for these soon-to-be rental properties, the price for said properties begins to rise, which is what we can see from the latest market reports. Unfortunately, the rise in pricing for these rental properties doesn’t allow first-time buyers to buy. Instead, these single-family homes are bought by investors and rented.

And therein lies the homeownership hit. It really comes down to inventory and these days there isn’t enough of it. And sadly, this leaves a lot of lower and middle-class families unable to join the ranks of homeowners. The more prices rise and expectations are met and/or exceeded, the more homeownership will drop. David Blitzer of S&P Dow Jones Indices states, “Home prices continue to rise and outpace both inflation and wage gains. If a complete recovery means new highs all around, we aren’t there yet.”

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