Hello Spring Market! We’d say we missed you, but it sort of feels like you never left us. As COVID-19 restrictions relax across the St. Louis region, buyer demand continues to skyrocket with it. According to the SLAR March Housing Report, inventory of homes is down 46% from 2020. Monthly supply is down 50%.
These aren’t numbers to overlook…What we’re facing is a very real inventory shortage.
If you’re a hopeful homebuyer asking, “Am I in over my head thinking this was the year to buy?”, remember this – you aren’t alone in your frustration. Buyers, sellers and agents alike are facing the cruel repercussions of record-low inventory and historically low mortgage rates (bidding wars, escalation clauses, waived inspections – oh my!)
Before you throw in the towel and set your sights on 2022, consider these tips for Mindful Buying in a Seller’s Market, courtesy of Circa Agent Katie Taylor.
Whether you’re a first-time homebuyer or it’s just been a while, take a refresher course on contracts and contingencies with your REALTOR®! Look at all the paperwork together, talk through a mock-offer and all the contingencies one-by-one along with each side’s role and responsibility. It will be much less stressful than having to learn all this under a deadline! You could end up in a situation where you have only a few hours to make an offer and being familiar with the process, the terms, and your options can make a huge difference, strategically and mentally! You don’t need a crash course in competitive offer strategies, potential risks, and probable outcomes under pressure!
Try to be as organized about the process as you can, while still having fun. Things are happening so fast! Homes hit the market and then go under contract all in a few days. Stay on top of the “Coming Soon” prospects and try to proactively plan weekly showing “dates” with your REALTOR®, maybe on the same day, same time, each week if you can. Take the time to do a drive-by before putting it on the appointment list! Check out the neighborhood, do your homework. You should have a pretty good idea that the home has checked a lot of boxes for you by the time you make an appointment.
Know your boundaries! Check your emotions! You have a pre-approval and probably a budget (or at least an idea of what you expected to pay monthly), try to keep this in mind when writing an offer. When you fall madly in love with a home and then find out multiple other buyers also fell madly in love with the same home, it’s understandable that you will want to compete to win! But at what expense? Be smart and make sure your Realtor is ready to talk things through with you. You don’t need an agent who just wants you to win…at any expense.
Don’t start making offers on any house just to get a house! At some point, you may need to take a breather. If you’ve made multiple strong offers on multiple homes and lost out – you are not alone! Don’t let this get you down and don’t let this put you in a position where you lose sight of what you wanted to begin with. You don’t have to settle! Talk to your Realtor about contingency plans if you need to put a pause on your search for whatever reason! Even if you just skip a week or two & then jump right back in.
Do you need to buy in this Spring Market? That would be my final question to any buyer. I am not sure I would ask the literal question (initially) but I would definitely talk things through with a current or prospective client, their goals vs. needs vs. timeline. I understand how exciting it is to be “ready” to buy, especially if you’ve been planning and saving for awhile. Plus the interest rates have been so incredibly low. However, remember that inventory was also incredibly low in 2020 and a sizable group of buyers that may have sat out last year are back in action.
All and all, this combination makes things crazy competitive. Right now, it is a very strong “Seller’s Market” and its effects are reflected in the behavior of buyers, which has evolved into what feels like some version of The Hunger Games. If you have any additional questions about buying strategies and best practices, please do not hesitate to reach out.
To contact Katie Taylor, visit www.ktplaces.com or reach out to her via email at firstname.lastname@example.org.