The last two years have produced the most turbulent home market statistics in the past 30 years. From banks not lending as much to homeowners not able to sell their homes as quickly as they used to, the real estate market can look dismal for some. Although, there is always a bright side to every negative statistic and there is promise for many home buyers. There’s a lot of inventory in the housing market so if you are a new home buyer or ready to start owning instead of renting… now is the time! Here 4 of the top tips to know if you plan on jumping into the real estate market in 2010.
1.) Buyer’s market means lots of opportunities: The term ‘It’s a buyer’s market’ is still valid and truer than ever. There is a surplus of homes from bank owned; foreclosed, new construction and pre-owned homes, that buyers literally have their pick of the masses. This news is great for those who thought they would never own a home, as the opportunities may look more promising with lower prices to entice them. This news is not great for sellers, because there is more competition, especially with foreclosed and bank owned properties that are selling for dirt cheap prices. Remember, everyone has an opportunity in this market, but sellers need to make their homes the best they can be for resale if they want to get to be the ‘buyer’ in the near future.
2.) Getting a bank loan is stricter than in past years: In past years, the requirements for qualifying for a home loan were relatively lenient and the average individual could find terms to meet their financial situation. After the fall of several bank and lending institutions in 2009, banks have stricter rules, require more documentation and will require your credit to be higher than in past years. This shouldn’t discourage you if you don’t have all items in perfect condition. It should be a red flag to you to start getting these items in order and visit a home mortgage loan specialist that can guide you to getting on the right track for the future.
3.) Home values are still stabilizing: Your home used to be the one purchase in your life that you could guarantee on appreciating over the years. Unfortunately with the home market crisis this is no longer true for some. As the market becomes flooded with more inventory homes, especially ones that are trying to get a quick sale or are bank owned, the value of homes may not be what you expect. If selling your home be certain to get a professional home appraisal before setting the asking price on your home. If you are buying a home an appraisal will most likely be done if you are seeking bank loan assistance, as they will not loan more than the home is appraised for. In many areas homes that are located in desirable areas are getting back their value quicker, while in some areas the stabilization rate is much slower. Check with a Realtor to get information for the area you wish to buy or sell a home.
4.) New construction has its pros and cons: Just like the rest of the housing market, housing developers and construction companies took a big hit with the reduction of sales. With the bank’s lending less money and competing with previously owned homes, new construction has its pros and cons. On the upside, many builders have decided to go ahead and finish building their home inventory if they don’t have contracts on them. This helps them have finished, move-in ready homes for buyers who are ready to sign on the dotted line now. This is great for home buyers that want to move quickly. The cons of buying new construction are the prices may not be competitive with pre owned sales, foreclosed or bank homes. Depending on your area this will vary, so check with local builders and developers in your area, they may surprise you and offer great incentives to move in!
Buying or selling a home has always been a process that many enjoy, but many despise. If you aren’t home market savvy, consider hiring a Realtor to help you through the process either way. They can help you with understand the ever changing market, and also help you narrow down homes in the vast inventory that is out there. With these 4 tips you should be able to make more informed decision as to whether now maybe the right time for you and your family to consider moving.
Freshome reader’s are you in the market to buy or sell your home? What concerns do you have? Have you been able to overcome many concerns on your own? Let us know.