It’s a seller’s market, and home buyers are the ones who have to pay the price. Literally.
More and more people are hitting the housing market during 2018, and the supply of properties available are not enough to meet the demand. This puts sellers in a position on power, able to ask above-average costs for their homes. Buyers are stressed enough by the competition that goes into winning a bid in the current market. They get a double-dose of stress from the price they pay for the home.
So what can you do to put less stress on your wallet? Check out this list of 5 ways to land a great value on a home. These are the best bets in a seller’s market for a buyer to get some bang for their buck!
Now, because of the value presented, there is often just as much competition for these homes, if not more. Stay tuned for next week’s blog post, on how to ensure that your offer is the one that wins!
Foreclosures do not deal with the impact of a seller’s market as much because they do not have a traditional seller. The home is foreclosed because the previous owner could not make their payments, therefore the bank has taken control of the property. They are looking more to recoup losses from failed financing, versus generating tons of equity.
Foreclosures are probably the most popular method of finding a great deal on a new home, and you should plan on competition. Make sure that you are preappoved for a mortgage, and remember these homes—like the rest in this list—come “as is.”
2. HUD Foreclosures
HUD (U.S. Department of Housing and Urban Development) foreclosures are different than traditional foreclosures because the seller is the U.S. government, and not a bank. As a result, these homes are often available at incredible discounts. Just be aware that there are likely to be fewer HUD foreclosures in your market than traditional foreclosures. Still, it is worth your time to visit HUD’s site for listings.
3. Short Sales
Short Sales are different than foreclosures in that the resident of the home is the seller. They are attempting to sell the property for less than the remaining value of their mortgage. This is often the result of losing one’s job or moving for it, or because they are dealing with sudden, unexpected debt.
Among this list, a short sale is usually the most complicated option. The bank or lender responsible for the seller’s loan is not going to be happy to sell for less than the mortgage is worth. This entails plenty of negotiations between your financier and the seller’s, but it is possible.
We’re not necessarily talking about the creepy, run-down home that has been empty for a decade. Many vacancies occur if the occupant passes away, or is forced to move before a sale can be carried out. Those responsible for the home often sell quickly, not wanting to continue paying its bills. If you have a tip on a vacancy that hasn’t hit the market yet, you can be proactive and seek out those responsible for it. Be polite, and win some points by offering to buy as is.
There is often a stigma around “fixer uppers,” but those looking for a good value can win big by being willing to get their hands dirty. Homes in obvious need of repair, or a significantly outdated decor, are usually sold at a discount greater than the actual work needed. For example, $10,000-worth of repairs often takes $30,000 off of the home’s asking price. Many buyers might avoid this type of property, but willing buyers can reap long-term savings from a little upfront investment.