As Atlanta home prices and mortgage interest rates increase and the number of houses for sale are few and far between, it becomes important to learn strategies for home buying in a tight market. Knowing how and what to negotiate can mean the difference between landing in the home of your dreams and watching from the sideline as others snatch up all the desirable houses.
If you’re feeling the competition heat up as you head out on your house-hunting venture, there are some key things to keep in mind.
Know what you want, but also be flexible
At this point you should have your neighborhoods narrowed down, know the number of stories, how many bedrooms, what kind of back yard and the type of layout you want. This way, you can be ready to jump when a house that meets your criteria lands on the market. At the same time, allow yourself a little flexibility if you come across a home that is close to what you want. The layout, neighborhood, and number of bedrooms will be more important than aesthetics. If a house is in rough shape but is fundamentally a match, then picture it with fresh paint, new flooring and modern appliances.
Get preapproved for a loan
When you have preapproval, the seller will know that the loan process is already under way. All your pay stubs, W-2 forms, tax returns and credit reports have been confirmed and approved. Also, the bank will indicate the amount of loan it is willing to give you. In a competitive market, a seller will be much more likely to accept an offer that has near-guaranteed funding attached to it. Proceeding with the preapproval process is also a good idea because if any credit errors show up, you can get those corrected before making an offer.
Make a competitive offer
Now’s not the time to lowball or play guessing games. When the market is tight, you want to make the strongest offer possible. Don’t go more than 5 percent below the asking price. If it’s possible, don’t ask for a contingency to buy when your house is sold. A seller in a tight market will likely have multiple offers and won’t want — or need — to wait for you to sell your house.
Be vigilant about reviewing new listings
As soon as new homes pop up on the market, drop everything to go check them out. Sometimes being the first to make an offer means yours will be the one that’s accepted.
Hire a real estate agent with a proven track record
An outstanding agent is key to helping you stay on top of the available homes on the market. A reputable professional monitors new listings, is in constant communication with her clients and knows the steps for home buying in a tight market. She’ll help you determine what a competitive offer is and help you with negotiations so you can stand out from the competition.
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