So how would I describe today’s real estate market? A Seller’s market. A Competitive Market. Nationally, there continues to be a shortage of homes coming onto the market. The same is true for Central Minnesota. According to the Minnesota Association of REALTORS®, we had 2.9 months of inventory available at the end of April; homes are on the market an average of 62 days (just two months). They also noted that the median sale price has been increasing steadily since 2012 to $200,000.
How Does This Affect You, The Buyer? Many buyers are asking: “How am I ever going to buy a house when the competition is so strong?” As a buyer in today’s market, you need to be extremely prepared, which can add another layer of stress to your already busy life.
Do Your Homework
Needs and Wants: Contact our office to discuss your needs and wants early in the process. Search out neighborhoods and school districts where you would like to live. This will narrow down your search and save you a lot of time in the end. List your “need” items; prioritize your “want” items. Consider all aspects of the home, including the exterior and yard, when putting your list together.
Financing: Make sure you have all your financing together before you even begin your home search online and with your REALTOR®. It is also important that your Lender is able to give you a strong approval letter.
Know Your Limits Even though you are approved for $200K, know your personal limits, too. Your approved amount from your Lender will not include extraneous costs, such as utility expenses, fees for cell phone use, entertainment expenses –you don’t want to sit home every weekend– car expenses and insurance, home insurance, etc., etc. No one wants to be “house” poor. Know your maximum amount you will be able to spend when making an offer; and leave room for negotiating – particularly if you find yourself in a “multiple offer” situation.
I Can’t Buy Until I Sell My Home Perhaps you are finding yourself in a situation where you need to increase the size of your home, or on the other hand, you want to downsize. Do you need the proceeds of the sale of your current home to help you finance your next home? Contact our office to help you determine what your current home is worth. We can also help you determine what changes may or may not be needed to make your home more desirable to the prospective buyer. Be sure you are ready to put your home on the market immediately if a seller is willing to sign a purchase agreement contingent upon you selling your home. Another option: talk to your Lender – maybe a bridge loan is an option for you.
I have had a couple instances already this year, where we have been in a “multiple offer” scenario. Time is of the essence in these cases. Doing your homework in the above areas prior to starting your home search gives you an edge over a buyer who is not as prepared and cannot make decisions as quickly as you can. It will also eliminate some of the stress you will encounter during these transactions. Quick decision making, knowing your financial limits, and being able to react quickly while in the negotiating process may render you the “owner of that new home”, which ultimately is your final goal. Good planning on your part will help keep your stress levels low. We can also help keep some of the stress at bay.
I am here to help you every step of the way–throughout the entire home buying process.
Berni Halaas, REALTOR®
New Century Real Estate and Interiors by Berni
