Here’s when the real estate market will calm down and 5 tips for buying now

Buying a home seems next to impossible right now, but there are always benefits to owning. Take your circumstances into account and follow these tips if you want to buy a home in today’s wild real estate market. (iStock)

The housing market is in full swing, with homes selling almost immediately after listing, often well above asking prices. Homebuyers are tasked with increasing their budgets or lowering their expectations, even forgoing standard contingencies like a home inspection.

The state of the market is in part due to a housing shortage of nearly four million units, according to Freddie Mac. Home prices climbed 17.2% between March 2020 and March 2021, with no sign of slowing down. Plus, historically low interest rates make this an ideal time to take out a mortgage.

No matter the fierce real estate market, buying a home is still a good financial strategy, as long as you plan to live there long enough to see the home’s value rise while building equity.

If you are looking for a mortgage, compare the rates of several lenders by filling out a single form on Credible. It will not affect your credit.

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When will the real estate market calm down?

Experts predict the real estate market won’t slow until late fall, and even then, home prices will remain high, according to Dr. Lawrence Yun, chief economist at the National Association of Realtors. By then, more new homes will hit the market, matching the supply.

“For those who are willing to wait, more choices will be available, but house prices and mortgage rates are likely to be higher,” Yun said.

5 tips for buying a home in today’s competitive market

If you’re looking to buy now, you’ll need to act quickly and with a competitive offer in hand. Use these tips to help you stand out as a home buyer in a sellers’ market.

And if now isn’t a good time to buy, consider refinancing to take advantage of record mortgage rates. Compare deals on Credible to make sure you get the best rate.

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1. Find a real estate agent who has a good reputation in your local market

In a booming real estate market, you’ll need all the help and connections you can get. Work with a real estate agent who has established a relationship with other agents in your community. They may be able to show you homes even before they are listed on the market.

2. Prepare with a mortgage pre-approval letter

Getting pre-approved for a mortgage shows the buyer that you have the financing to complete the transaction and that you are ready to take the next step. To prepare for the mortgage pre-approval process, gather your latest payslips, bank statements, proof of identity, and information about all the assets you own.

Just like you would be looking for the lowest price on a new car or laptop, you need to make sure you get the best deal – the lowest interest rate – on a mortgage. You can compare mortgage rates from multiple lenders without harming your credit score in Credible’s online loan market.

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3. Look at homes below your budget in case you need to bid above the asking price

Home values ​​are rising faster than ever, so the home you fell in love with six months ago may be out of your price range. You might consider looking for smaller homes or looking further out of town to find a home you can afford.

And since so many homes are selling for above asking price, it’s a good idea to leave a little wiggle room in case you need to bid higher.

“Have an absolute maximum on the height of an escalation clause and don’t go beyond what’s been predefined as emotions might be aroused after viewing the property,” Yun said.

See how much you can afford to buy a home using a mortgage payment calculator, keeping in mind that housing costs should ideally not exceed 30% of your gross income.

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4. Make sure you are available to visit as soon as a house is listed.

A few hours can be the difference between closing a house and missing one. During the home buying process, you should make yourself available as often as possible, so that you can schedule a viewing and make an offer before other buyers have a chance to view the property.

One more thing to keep in mind: “Keep a close eye on property, as a home inspection may need to be waived in a competitive market,” Yun said.

5. Be flexible with your closing date

Buying a home can seem like a rushed and urgent process, but it pays off if you don’t have a deadline for closing. Giving sellers the flexibility they need to scale their schedule can help differentiate your offering from others.

By following these tips, and with any luck, you may be able to buy a home within your budget without having to sacrifice what you want. And if you have any questions about the mortgage process, contact a loan officer at Credible.

About Jermaine Chase

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