5 Practical Tips for Buyers for the Spring Real Estate Season:
1. What do you want in a house or condo? How do you envision the next chapter of your life?
Write it out - all the things you need and want in your new home. (White board it - while being practical).
Factors to consider:
Location / Neighborhood
Price
Size
Outdoor space
Parking /Laundry requirements
Schools districts…be as specific as possible.
Note: where you start your search and where you end up may be very different places, so be it…
2 . Viewing Homes Online vs. In Person
See homes in person - this way, you can get a feel for the house, it’s precise location, the neighborhood, the neighbors, what’s going on nearby. Pictures of homes online can be deceptive, and it can become a time wasting game to swipe through them daily…You won’t see the homeless encampment, the electrical wires near the bedroom windows or realize that you can hear the highway a few blocks away until you see a place in person. Go to Open Houses, and as your focus in and get more serious about making an offer, set up private appointments through your Buyer’s agent.
3. Have a conversation with a Bank Lender or Mortgage Broker
Lenders are competing for your business, and it’s helpful to consult with a few to see who gains your trust, confidence, can get you the best rate and actually close on your loan. They can also present you with different types of Mortgages: a 30 year Fixed, ARM, interest only loan - there are many options. The process is straight forward: have a conversation with a lender, send over some financials – pay stubs, tax return, asset statements (savings, investment account etc.), as well as current debt statements. The lender will review and generate a preapproval letter for a certain loan amount. This will demystify your target purchase price and what your monthly payments will be. Anytime a Buyer tells me they are looking for a house between 2 – 3 million, I know they haven’t taken this step, because that’s too big a price range to consider and the payments will vary by 50%!
4. Have a conversation with your accountant
There are real tax deductions to homeownership – property tax, interest on the first $750,000 of your loan, these are real savings that will factor into the decision to own rather than to rent. Have your accountant do a rent vs own scenario, comparing the carry costs of each – if you end up paying a little more each month with home ownership, remember you are building equity by putting that extra amount into your home – a sort of forced savings account.
5. Work with an Local Agent
When you go to an Open House, the Listing Agent or host is not necessarily your friend. They have a contract with the owner to sell the property at the highest price. You need someone on your side, advocating for you, to get you the most amount of house for the least amount of money. A local, experienced agent, who knows the neighborhood, inventory, and trends is crucial. Your buyer’s agent will add value to the buying process in many ways: negotiate the price, get your offer accepted over other offers, refer, organize and schedule inspections, provide you with a list of contractors for all types of jobs, home insurance and home warranties your new place will require down the road. Your Buyer’s agent is your real estate consultant for life, providing you with real time information every step of the way during the course of your ownership - a real resource to draw on.
Outlook for the coming season:
The Market is much more Buyer friendly now than in recent years – we have approached and probably passed what I would term as "the bottom." There has been real uncertainty in the economy from inflation, mortgage interest rates, recent bank failures, as well as the debt ceiling deadline on/around June 1. Add to that, the market has just been through a 12-month correction. Now it appears prices are stabilizing & buyers are coming to terms with a 6% interest rates on a loan. It remains to be seen if prices will rebound to previous levels and how long that might take or if real estate valuations will revert to the typical 5-ish% price appreciation per year going forward. No matter, this should be an interesting season for those opportunistic people looking to buy a home.
Reach out to me anytime to discuss. I'm local, experienced and I enthusiastically work this market very well.
Sincerely,
Robert Maschio