The currently hot real estate market can create a frustrating situation for buyers looking to purchase their dream home.
“This is the most unprecedented market we have observed,” said Rogers Healy, owner and CEO of Rogers Healy and Associates Real Estate. “It is not abnormal in this climate for buyers to lose out on multiple bidding wars. Many buyers can’t compete with strong competition coming in with cash offers well over asking prices. Buyers [becoming] fatigued or discouraged has become commonplace in such a competitive market.”
If you’re currently in the market, you may be dealing with homebuyer burnout. But there are a few ways you can cope with these feelings and proactive steps you can take that can help you overcome your stress and get the home you want.
Make a Plan
Having a home-buying plan in place can help mitigate your feelings of anxiety and uncertainty.
“The homebuyer needs to make a plan and decide that, no matter what, they will stick to their plan,” said Eric Nerhood, owner and president at Premier Property Buyers. “Set a budget and be realistic about it. Know what you can and can’t spend and stick to it. Don’t ever let an agent or seller convince you that your limit is unreasonable. If it’s your limit, it’s just that — a limit.”
Being financially prepared to buy a home is one of the best ways to reduce stress around the process, and getting preapproved for a mortgage is an essential part of your financial prep. Plus, it will make you a more appealing buyer.
“Just as buyers are trying to capitalize on the frenzied market, sellers are as well,” said Ben Creamer, principal and managing broker at Downtown Realty Company, a full-service brokerage based in Chicago. “Offers from buyers who are pre-approved and can close quickly will be much more attractive to the seller.”
“My best advice to home buyers right now [is to] stay the course but be flexible,” Creamer said. “The right home is out there, but you might have to knock on a lot of doors to find it. It’s common in any market for a buyer to lose out on the first offer they place on a home, but in this frenzied market, it’s almost guaranteed. We encourage our buyers to stay the course on what’s most important to them in their new home search, while also remaining open-minded to considering homes that might not check all of the boxes.”
This means determining which items on your checklist are “must-haves” and which are really just “nice-to-haves.”
“You might need three bedrooms for your kids, but you might be able to do without that extra half bath for guests,” said Khari Washington, broker and owner of 1st United Realty & Mortgage. “You might have always wanted a rain shower in your bathroom, but you can buy fancy shower heads that create the same effect. You may hate certain paint colors, but you can paint a house after you purchase it. By being more open, you will open yourself up to more possibilities.”
But Don’t Make an Offer on Every Property
While having some flexibility is key in this market, you may be so desperate to buy a home that you’re now making offers on homes that you don’t actually like or that don’t fit into your budget. But doing so will just add to your negative feelings around the homebuying process.
“One of the top causes of buyer burnout is seeing too many properties and submitting an offer on every single one,” said Leah Malcolm, a realtor with Othen Group. “You should only physically go see and submit offers on properties that will most likely sell well within your budget.”
That means you should be looking at properties that are actually listed below your budget.
“Since many houses are going above their asking price by more qualified buyers, become one of those more qualified buyers for a lower price point,” Washington said. “That way, you have room to bid higher and stronger.”
Learn From Your Losing Bids
“I encourage buyers to see each losing offer as a learning experience,” said Beatrice de Jong, consumer trends expert at Opendoor and a broker associate based in Los Angeles. “Next time, you may need to decide faster, raise your price, offer more aggressive terms or get creative with ways to appeal to a seller.”
Washington recommends making your first offer your best offer.
“Many buyers get frustrated when they make an offer and it quickly goes to someone who makes a higher offer at a number they would have paid,” he said. “Make sure you make your strongest offer first, that way if you don’t get the home, you know they paid more than you would have ever paid.”
Lean on Your Real Estate Agent
Your real estate agent is there to help you through the process and make it less stressful.
“They should be making your life easier and keeping you from feeling that burnout,” said Michele Harrington, chief operating officer at First Team Real Estate. “It’s their job to make the buying process as easy as possible so that you don’t feel the stress. And if your agent isn’t making your life easier, it’s time to find a new one.”
Take a Break
Putting a pause on your home search may not only be good for your mental health, but also for your wallet.
“For the time being, the market is flooded with buyers and available inventory is limited, so there may not be as many options as a typical buyer would like to see,” Creamer said. “As we head into the fall months, the number of buyers will likely decline, which should help balance the supply/demand constraints we are seeing right now. Buyers who can tap the brakes on the home search now and wait a few months might have better luck not only finding a home, but finding one at the right price.”
You can use the time away from the market to make yourself a more appealing buyer.
“This waiting period can be used to build a bigger down payment and improve your credit score,” said Jonathan Sanchez, real estate investor and co-founder of Parent Portfolio.
Original source: GoBankingRates