Unless you have been living under a stone, I’d like to mention that it is a great time to buy a house. Interest rates are low … really low! In addition, the market in metro Denver is turning. No one ever knows the future with certainty but it sure looks like the market has bottomed out and that prices are starting to rise.
At the same time, I don’t want you to get caught up in a buying frenzy. There are steps we can take to take deliberate and careful advantage of the current window of opportunity. Here are the key elements for success:
Get Pre-Approved (really pre-approved) for a Home Loan
I know it’s a lot more fun to look at houses than to jump through the hoops of getting a home loan. But in today’s market environment, it is critical to get a thorough pre-approval. We may be in a situation where we are competing with other buyers for a house. The buyer with the most solid pre-approval often wins. A pre-approval is more than just a pre-qualification. In a pre-qualification, you tell the lender how much you make, how long you’ve been on your job, how much money you have etc. But for a pre-approval, we go one step further. You actually give the lender documentation on all these things – paystubs, W-2s, tax returns and bank statements. The lender obtains your credit report. All of this puts us in a stronger position when we make an offer. The lender can give the seller greater assurance of your prospects for getting a loan.
Think Longer Term
It makes sense right not to imagine the house that you’ll need for the next 10-15 years. With interest rates low and prices down form their high water mark in 2008, you can buy more house than you could at any time on the last 10 years. It is a great time to think about a house that not only meets your current needs but which will also work for you in the longer term as your family grows .. or shrinks.
Explore Possibilities and Define What you Want
Since there are fewer properties on the market today, it makes sense to think broadly about the location and the type of house you want. I always like to start by having you define your ideal home. Then we will explore options. Can other locations work? Do you have some flexibility on floor plans and features? By defining your market as broadly as possible, we give ourselves a better chance of finding a place in this environment of reduced inventory.
Be Prepared to Act Quickly
Desirable homes go quickly in today’s market. CLICK HERE TO SEE THE LATEST LISTINGS. So we need to be watching every day for new stuff that is coming on the market. We also need to get out there and see those properties right away.
React Intelligently when Confronted with Competing Buyers
We run into more situations today where we are competing against other buyers for a house. If can drive you crazy if your strategy is based on trying to out guess what other buyers are doing. Our best approach is to figure out the highest price that your are comfortable paying and making that the basis of your offer. In addition, I’ll help figure out if there any any nonprice factors that we can use in the negotiation. Strong loan pre-approval, quick closing or delayed closing, seller rent-back after closing – these and other non-monetary factors can be important to a particular seller. By finding out what the seller needs beyond just price, we can potentially swing a deal our direction.
There you go. These are some of the keys to making a smart choice in today’s market for home buyers. I’ll look forward to talking with you soon about any purchase needs you, your friends or your family may have.