How to make a purchase in the Summer Season
07/20/2003
How to make a purchase in the Summer Season
07/20/2003
This year the real estate market is hot as ever. The demand for more houses is not satisfied by the amount of houses that is actually put on the market. In such unbalanced supply and demand situation, buyers may find it difficult to buy their dream homes. At times like this, if you can avoid buy a house altogether, that's great. But if you have to, then you have to be well prepared before hand to make a purchase this year
The most important thing is to be prepared: first find a good lender or a good loan agent or broker. Have your credit report ready; get a pre-qualification letter ready, especially when your down payment is under 20%. Also get the proof of your down payment ready too.
There is this one thing that every buyer should know about this year: appraisal problem.—at times like this, when real estate is going up, the value of the house go up significantly, but when the bank or the lender send an appraisers to do an estimate, they usually can not match the ongoing price that rises every second. Therefore when you buy a house at $400,000.00, the appraisal value might be only $390,000.00 because the appraisers use the transactions from last month as a standard for the appraisals. Because the appraisers use the value of the houses from last month, and because all the current house selling transactions that have not closed yet can not be used as a standard to appraise a similar house, of course the appraisal value can never match the true value of the house you are buying. When you buy a house right now, chances are that you will probably end up buying the house at a price a lot higher than the appraisal value, and that mean one thing: except for the down payment, you better prepare to have extra money in the bank to make up the difference in the appraisal value to the market value, so your loan can be approved smoothly.
Another tip: get a handle on the current market. When there are more buyers than the houses on the market, the timing is what the buyer lacks. Properties that are decent in prices right now will be sold in about a week. So if you want to buy a house this week, then you have to know where the good houses are, go see them, and make the offer fast. You want to make an offer fast and get the deal done right away. Some buyers who still think about bargaining the prices with the sellers might end up losing the house to someone else or even end up buying the house with even higher price because there are many competitors on the market right now. Before you start looking, make sure that you set up a standard to what you want in your dream house. Let your selling agent look at your conditions and standards to see if they are reasonable according to the current real estate market. If your budget and conditions are more reasonable, the more houses you can look at and consider. On the other hand, if your budget and conditions are not as practical, the less chance you will be able to find your dream home.
Check out as many houses that fits your criteria as you possibility can. Even though the demand to buy exceeds the available houses, you should still look at all the possibilities so you can effectively compare. Usually a good agent can help you do that in about 2-3 days. After that you will have better idea as to what you want in a house and what fits your budget. This will definitely help you in making decisions so you won’t miss the chance of buying the dream house when you find one. If you have seen all the houses and still haven’t found one that you like, then you should go on MRLS and check every day for new listings.
You should look for a house that fits your own budget, criteria, and your own needs. Everyone has different size; one shirt that fits your brother might not fit you. When you consult with your friends or families you should do that before you start looking at house. When you are choosing a house, too much opinion from other people sometimes might not be a good thing
Again, choosing a reliable agent is the very essential thing. I have too many experiences of past clients who already signed with an agent, but still call me to verify every step of the way when they are making the deals. If at this time, I purposely misdirect people, tensions may rise between the buyer and the agent. I have to tell everyone again, find an agent that you can trust. If you are not satisfied with your agent, then you should tell your agent early and maybe find another. This way, you will save a lot of time and trouble on both your part and the agent’s side. You have the right to choose your agent, however, once you have entered the real buying period, you should definitely trust your agent and stop going to other agents for opinions because you are just being unfair to your agent who is working very hard for you at this point
A tip on choosing an agent: there is selling agent, listing agent, and agents that both sell and buy. Buying and selling is actually two entirely different skills. Some agent s are good at buying real estates, some specializes in the selling of your house. But one thing for sure is that no matter what, the agent should be familiar with the area that you are buying or selling, otherwise no amount of talent or skills can be effectively demonstrated. You can start finding an agent by asking people which agents work in this area more and whose services are the best.
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