For quite a while, we were in a seller’s market. All sellers had the upper hand; most sold their homes for more than they listed.
Fast forward to today and that’s no longer the case.
Home inventories have fallen and interest rates have skyrocketed. So is this good news or bad news for buyers?
For now, it’s good for buyers – here’s why.
First and foremost, there’s much less demand. This time last year you couldn’t wait for more than a day or two to see a home once it was listed or it was under contract. Not only that, but it was under contract for much more than it was listed for and buyers were waiving appraisal contingencies.
Today, that’s not the case. There are not as many buyers in the market because of higher interest rates, so buyers have much more opportunity to look at more homes and bid what they want on a home, not what other buyers are pushing them to bid.
The selling craze of last year made sellers go crazy. They weren’t accepting offers even a penny below their asking price, and most were holding out for the highest bid above their asking price.
It makes sense why they’d do it, but it’s not fair to buyers who invest in these homes, spending more than the house may be worth in a few months.
Today’s market has much more reasonable sellers willing to negotiate prices and allow you to pay a fair price for the home. You also don’t have to feel pressured to waive the appraisal contingency.
There is one aspect of the shifting market that can be a challenge for buyers: mortgage rates. They’re at the highest in decades, with recent rates hitting over 6%. This could price many buyers out of the market.
The good news is you can shop around to get the most competitive rates, and you may even control your rate by perfecting your qualifying factors.
Before you apply for a loan, check your credit score and fix any issues you find. Stabilize your income and make sure you have a decent down payment. Don’t show up with the bare minimum requirements. Instead, show lenders you are a good risk and are serious about buying a home in today’s market.
The market is shifting, but that’s not always a bad thing. Buyers couldn’t continue paying overinflated prices for homes and not expect the bubble to burst eventually.
With things settling down, prices will decrease and buyers will have more options. Sellers may wait longer for their homes to sell, but everything won’t feel like such a frenzy. Instead, it will feel like a more relaxed process where everyone can get what they want from the real estate transaction.
If you’re ready to look at homes on the market today, contact me today, and let me help you find the perfect home.