How to avoid buying the wrong home in a hot market

Angela & Brian O'Hare - The O'Hare Team
Angela & Brian O'Hare - The O'Hare Team
Published on August 18, 2018

How to avoid buying the wrong home in a hot market!

Many home buyers are finding themselves in an unusual situation: They have enough money and are pre-approved for a mortgage, but can they actually secure a house?

The number of homes for sale continues to fall, with the supply of homes of homes for sale even tighter at the lower price ranges.

That creates a major challenge for home buyers, especially first-timers. If a prospective buyer isn’t careful, he/she could end up jumping at anything just to get a house, only to realize later that he/she bought a home that’s not right for his family.

Here are eight ways to avoid buying the wrong house in a competitive market.

Work with a trusted agent. Using an agent can give buyers an edge because the agent has access to information from the multiple listing service that buyers won’t find online. An agent can also help prospective buyers prepare their strongest offer. Line up your agent at the beginning of your search. If the agent doesn’t want to help you discuss you options before you’re ready to buy, find another agent.

Know what neighborhood you want. Explore and drill down into neighborhoods before you start seriously looking at houses. If schools are important, know the boundaries of the districts you want. Test the commute time from locations you’re considering. Don’t just research online, but also visit and talk to neighbors. Once you’ve chosen the neighborhood, you can narrow the search to the specific house.

Know the market. Know what types and sizes of homes are common in your preferred neighborhoods. This will help you know, when you see a listing or tour a home, whether you can expect a similar home that meets more of your needs to come along later. You also want to know how fast homes are selling, whether they are going for over asking price and what the sale price per square foot is, though your agent can help you with the numbers.

Know what home features are important. If you have a son and a daughter, settling for a two-bedroom house when you need three bedrooms probably doesn’t make sense. Buyers never get everything on their wish list, but you need to know which features are essential for your happiness.

See as many houses as possible. Once you decide you’re interested in buying a home, start going to open houses, even if you don’t have an agent yet. Open houses are an easy way to see lots of homes and talk to agents about options without making a commitment.

Know your budget. No matter your housing budget, you always discover that the features you want cost a little more. Plus, you could encounter a situation where you have to offer above asking price. Set a maximum for what you’re willing to spend and stick with it.

Always get a professional home inspection. In most areas, you’ll be asked to sign a contract to buy the house “as is” with the right to inspect. That means the seller is unlikely to make repairs, but you can withdraw from the deal if you don’t like what the inspection reveals. Before buying a home, you want to know the condition of the roof, ceiling, plumbing, electrical system and heating and air conditioning system. Knowing about foundation problems, water damage or termites is also important. You can typically use the inspection contingency to withdraw from the contract even if you don’t find major problems, giving you a few days to make sure you’re happy with the home once you’ve signed the contract.

Understand you may lose a few. Most first-time home buyers aren’t ready to move quickly the first time they see a home they like – or maybe even the second time. Even if they make an offer, they may not get the home. “It’s a learning process,” Rae says. “They see the home. They feel like they can’t move yet. It disappears.” Losing out on a few homes also may help you know the right one when you see it.

Article by: Teresa Mears
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