Navigating the real estate market has been a challenge in 2023. Low inventory coupled with high home prices and interest rates have forced many to wait patiently on the sidelines. Now that the busy summer homebuying season has passed, new opportunities for patient homebuyers are rising.
If you’re gearing up to buy a home this autumn, these four tips will help you make the most of the experience.
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1. Narrow Down Your Buying Criteria
One of the key factors in a successful homebuying experience is establishing what you want and need out of a house before you begin shopping. Start by writing down your wants and needs. This should include location, square footage, bedrooms, bathrooms, land or property condition.
Thomas McNamara, a real estate agent and broker with eXp Realty in Orlando, Florida, emphasizes the importance of narrowing down ideal locations.
“Prioritize neighborhoods with low crime rates and proximity to essential services like grocery stores, hospitals and transportation hubs,” McNamara says. “If you have or plan to have children, research local school ratings and proximity. Even with not having children, school zoning can drastically affect sales prices in the future.”
You may also want to consider potential job locations or consider areas with easy access to main highways, he suggests. Ideally, try to find two to three neighborhoods that meet these criteria to start your search .
Next, move on to what you want. Is there a style of home you prefer over others? Would you like certain amenities like a garden, pool or mother-in-law suite?
Finally, look at your budget. There are a lot of factors that impact how much house you can afford beyond how much you earn in a year. Tools like a mortgage calculator make it simple to see what your monthly payment would be in different scenarios.
Leave room in your budget for additional home expenses like property taxes, insurance and utilities. It can be hard to estimate how much this will cost beforehand, as the rate will vary from home to home. However, it’s a good rule of thumb that the mortgage payment should never be toward the high end of your budget when you start house hunting.
2. Get Acquainted With The Market (And Be Realistic)
Now that you have a shopping wish list and set budget, it’s time to see how realistic those are in your local market. The housing market is extremely localized and seasonal. What’s happening in one area or neighborhood can be quite different from what’s happening in another. Fall is typically a slower season for housing. People are preparing for the cold winter months and often save their listings for more favorable weather in spring.
This is especially true this autumn. Pending home sales in August 2023 were down 18.7% compared with the year before, according to the National Association of Realtors (NAR). “Less buyers in the market means less competition and more inventory to choose from,” says Jess Phillips, a real estate agent with the Anna K Intown Team in Atlanta. “The uptick in mortgage rates this year has caused some buyers to leave the market, presenting an opportunity for those that remain to come out on top.”
Knowing what’s happening in your chosen location will help you start your search with a realistic point of view. Some homebuyers are surprised to find their wish list isn’t achievable at their price point or given the current inventory. This is especially true in today’s inventory-strapped housing market.
“Those who enter the market with a ‘possibility’ mindset often have a more enjoyable shopping experience,” Phillips says. “I cannot tell you how many times I found a house for my clients either in a neighborhood, they didn’t originally plan on or with a layout that they thought they didn’t want. Open minds and flexibility make the experience that much more fun.” .
You may discover that you may have to move certain “needs” into the “wants” category. For example, maybe you do without the extra bedroom, consider a home with slightly smaller square footage or expand your search to a different area. Only you can determine what is negotiable in your buying criteria. Being acquainted with your local market and its available inventory can give you an idea of where you may need to budge.
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3. Secure Your Real Estate Agent
As you prepare to start the homebuying process this fall, start searching for a knowledgeable and experienced real estate agent you can trust. Don’t just go with the first real estate agent referral you receive or the first person who pops up online. Interview multiple realtors to see who you connect with and to assess their experience.
“Ask things about their experience as an agent, what type of homes or areas they specialize in, and if they primarily work with buyers, sellers or both,” McNamara says. You want someone who knows your market and the process of buying a home so they can better negotiate for you.
“Ask for testimonials from other clients or if they can share recent stats or trends for your area, to help you gain a better understanding of what is happening in your market,” McNamara says. “Don’t forget to ask who else they work with. Most agents will have a team on their side to make sure your needs are met throughout the entire process. Find out who else you might be in touch with, if you go with them, and what services they use to make the transaction go as smoothly as possible.”
Having a good agent on your side can help you potentially score things like off-market listings, negotiate a better deal or simply move through the transaction with ease.
“We are seeing homes sit on the market longer in the greater Atlanta metro market,” Phillips says. “When days on the market increase, we have more bargaining power. I may be able to help negotiate a price reduction, get the seller to pay for closing costs or get a home warranty thrown in. Buyers can then use those seller-paid closing costs to buy down their rate, which I would say is a lot of buyers’ biggest holdup at this time.”
4. Be Offer Ready
The final step is to get your finances in order. Get preapproved for a mortgage. Know what payment amount you’re comfortable with and reach out to lenders to find out how much mortgage you’re preapproved for. They are not always the same thing.
There are fewer buyers in the market this fall, but in some hot markets, competition is still fierce. You want to be ready to act when the right deal comes along.
The process for preapproval isn’t as difficult as a some buyers fear. Doing this gives you more confidence as you shop, and sometimes a head start if preapproval is required to view a property. Preapproval letters are helpful to include with an offer, as it lets the seller know you have the financial backing to complete the purchase. Some sellers won’t consider an offer without a preapproval letter.
This fall definitely offers buyers unique opportunities and more favorable conditions than those seen in several months. By honing in on your buying criteria, gaining a realistic perspective on your local market, securing a trustworthy real estate agent and ensuring your financial readiness, you’re primed to navigate the fall market with confidence.
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Want to Buy a Home This Fall? Do These Things First originally appeared on usnews.com
