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The Rules Home Buyers Should Break
The process of buying a home is constantly changing, and today's market looks a lot different than the seller-friendly market that we saw for much of the COVID era. As a result, many of the "rules" that buyers were forced to adhere to can now be tossed out the window.
Today, we're seeing a much more balanced market, which means sellers don't automatically win, and buyers don't have to make the same sacrifices in order to land a home. If you're currently shopping for a home, our real estate agents recommend breaking these "rules" in order to get the best deal:
- Making An Offer Immediately
Pandemic-era buyers learned that to have any chance of landing a home, making an immediate offer was a necessity. Homes often sold as soon as they hit the market, which mean potential buyers had little time to think over the most important financial decision of a lifetime. However, the market has slowed as higher interest rates mean fewer buyers (or competitors) shopping. As a result, if you have your eye on one of these Suffolk County homes for sale, you'll likely have some time to think it over. - You Have To Waive Inspections
When buyers are looking for creative ways to make their offers standout, inspection contingencies are one of the first things to go. However, skipping a general home inspection, pest inspection, or sewer inspection can lead to significant risk — especially for first-time buyers. You don't want to buy a home that is going to immediately sink you with repair costs. However, because the market isn't as competitive, waiving inspections probably isn't necessary. - You Have To Pay Over Asking Price
A couple years ago, buyers were making unprecedented offers, often going more than 20% over the asking price and offering all-cash deals. While going over the asking price may be warranted in some cases, it's not always a necessity. Buyers have more room to negotiate prices down in today's market. - You Should Always Put Down 20%
Making a 20% down payment definitely has its advantages. You can accumulate more home equity and avoid paying Private Mortgage Insurance (PMI), which protects your lender if you default on the loan. However, if you can only put down 20% at the expense of draining your savings, you should rethink. Owning a home is expensive, so you'll need to have cash on hand for upgrades and unexpected repairs. If you don't have a ton of money saved up, you can likely get by with a 5% or 10% down payment instead. - Don't Ask For A Seller Assist
A seller assist is an important tool for first-time buyers who have the income to afford the mortgage payment but maybe haven't saved up quite enough for the down payment, closing costs, and pre-paid expenses. A seller assist is a request for the seller to cover some or all of the closing costs in exchange for a credit, which is usually tacked on to the sale price. This concept was essentially non-existent during the pandemic, but now that buyers have more leverage, it's becoming more common.
Buying your first home can be tricky at any time, but luckily, today's is a bit more buyer-friendly than the previous few years. Contact us today to begin your home search.