What’s it like to be in the market for a new home in 2021? Over the past year, historic low interest rates and dwindling supply have caused the housing market to fire up like the ceramic oven at our favorite pizzeria, Napoli. Although the market seems to be stabilizing and may even cool off, the effects of the pandemic-induced buying spree may be felt for some time.
As we approach the halfway mark of 2021, here are six tips for anyone looking to purchase a new home in the near future.
Separate “preferences” from “dealbreakers”
Everyone has preferences. Maybe you want a short commute. Or a particular type of exterior styling. A good school district, friendly neighbors, or a den-with-a-view for your new work from home job.
For many, houses are the biggest asset purchase they will ever make. More than just an investment, homes are also an anchor point. They are where the heart is, as the saying goes.
But in a Seller’s Market, buyers must be aware that being too rigid can quickly take you out of the game. It is vital to consciously separate the things that are desirable—e.g. preferences— from the things that are absolute dealbreakers.
Our advice? Be flexible when it comes to preferences, but remain rigid when it comes to dealbreakers. Remember that car with the interior you weren’t crazy about, but now hardly notice? That’s an example of an (unimportant) preference evolving over time. But a dealbreaker like location, layout, or school district can have a lasting impact if you compromise against your better judgement.
So, create a list of preferences and dealbreakers. Put them on paper. Doing so creates a sense of clarity and a framework for fast decision making—both of which are vital in today’s fast-paced housing market.
Set realistic expectations
Once preferences and dealbreakers are established, it’s time to look at overall expectations. Here are a few things to consider:
- Housing supply is at a record low
- Due to supply chain issues from the pandemic, new construction starts are also low
- Increased demand is driving prices up
For many buyers, the above factors make it difficult to find a new home that fulfills expectations. Newly constructed homes may not be available. And if they are, they might be listed at 15% or more than just a year and a half ago.
As a result, buyers are increasingly looking to purchase existing homes—and often disappointed by certain things, like common areas and amenities (or lack thereof).
If you do not accept these realities, the initial weeks of your house hunt will be slowed as you learn them firsthand. If you set expectations accordingly, however, you will immediately hit the market with a keen eye for value.
Use Google, but temper searches with calls to professionals
The Internet is an exceptional resource for gathering all kinds of home buying information. Popular neighborhoods, historical home value estimates, and mortgage calculators are just a few of the many tools that can—and should—be used.
However, information is just that: Information. Data points. It could be clean, organized, and insightful. Or it could be inaccurate, messy, and confusing. The latter can shatter your dreams of finding a new home in such a competitive landscape, so it’s wise to hire a professional who can help to make sense of the market.
Put another way: If you’re feeling fluish and spend hours researching your symptoms, would you allow WebMD to convince you that you contracted bubonic plague? Of course not. You would gather the information, take a breath, and schedule an appointment with your PCP.
Buying a home is no different. Don’t head into the market alone, thinking you have the plague.
Prepare for multiple offers
With so many buyers and such low inventory, it’s not surprising most listings create a bidding war amongst several highly motivated buyers. This underscores the importance of working with a professional. By now, many real estate agents have become seasoned in the art of the bidding war.
Deep understanding of the marketplace, a successful track record, and experience in negotiating multiple-offer situations are all critical.
Think ‘big picture’
In this case, ‘big picture’ means just try to relax. Prices are high, supply is low, and bidding wars are everywhere. It is easy to get swept up in the process. If we assume that stress is simply unavoidable, then we can also assume that taking time to de-stress is mandatory.
Schedule time to do something—anything—that doesn’t have to do with the home buying process. Take a yoga class, visit your favorite beach, read a good book, or maybe take a cooking class online. Allow your attention to wander toward things that genuinely interest you. Not only will you feel stress begin to dissipate, but you’ll also feel renewed vigor when it’s time to engage in the house hunt again.
About Diana Fischer
Diana moved to Sarasota in 1990 from New Jersey and started her real estate career in 2008 with Michael Saunders & Company.
She has a background in preparing and negotiating government contracts. Her previous experience also includes the medical field where she developed her listening and human relationship skills which have proved vital in real estate.
She understands that buying or selling a home is one of the most critical decisions people have to make. That is why she feels it is important to listen to concerns and objectives. This enables her to tailor the process to each individual. It is through her dedication, perseverance and compassion that she meets the expectations of customers.
Her designations include GRI and Green. While she loves cooking, entertaining, traveling and reading, her passion is Crossfit.
Interested in buying or selling your home? Contact Diana today!
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