Typical home financing involves a buyer finding a home and applying for a mortgage, getting…
If you’re thinking about buying a home in Eugene, be prepared for sticker shock! A seller’s market exists when there are more home buyers than sellers. Depending on the market and availability, this means that seller’s can sell their homes for almost any price.
The laws of supply and demand give sellers the advantage in this situation. But that doesn’t mean there’s no chance for savvy buyers. We have some tips to help you understand the local market and seller motivations that may give you the upper hand when buying a home.
Shore Up Your Finances
Make like a boy scout and be prepared! If you’re serious about buying a home in Lane County, you’ll want to get your financial ducks in a row first. Homes here are selling so fast that some don’t even make it to market first. In this kind of environment, you want to be the most qualified buyer. First, review your finances and check out your credit report. If you have any dings in your credit report, act to correct them. Second, figure how much home you can afford per month. Set up a simple checklist of debts vs. income to see how much mortgage you and your family can afford.
Once you’ve reviewed your finances, it’s time to talk to a bank. Ask to be pre-approved for a mortgage. The benefit of this process is two-fold. First, you’ve already completed a large part of the financial requirement to buying a home and you’ll know how much mortgage you can afford. Secondly, you will impress homeowners when you make a solid offer that’s already backed with a mortgage. It’s a competition game and the buyer with the first, best, and guaranteed offer will likely walk away with the prize of a new home.
Hurry Up and Relax
But not too much! After you’re pre-approved, learn to be flexible, but be prepared to work fast if you need to. Work with your real estate broker to know what’s out there, what interests you, and what sellers are doing in the market. Some sellers want to sell immediately to the first buyer and others are more interested in selling to the right buyer. Your agent can talk to listing agents to find out things like how many showings there have been and how many offers are pending on a home. They may also know the seller’s motivation, like how fast they want to conclude the transaction and how to propose a serious and impressive offer. Taking your time to find the right home and the right seller will give you the opportunity to craft an offer they can’t refuse.
Cash is King When Buying a Home
Let’s face it: in most cases, the more money you can present, the more impressive your offer will appear. Twenty percent may be standard, but if it’s within your means, offer more cash for a down payment. Make an impressive earnest money deposit to show your commitment to the sale. Making the mortgage transaction as seamless and as profitable as possible for the homeowner puts you in the immediate position of snagging the home you want.
Enjoy the Win!
Buying a home in a seller’s market requires patience and perseverance, but the prize is a beautiful home in a beautiful town! Make your plan and stick to it land your home in a tight market.