Someone reassure me about buying a house in this market

posted 1 month ago in Home
Post # 2
Member
2027 posts
Buzzing bee
  • Wedding: July 2018

Would you feel comfortable doing any work to the property? I live in a very HCOL area with a very hot property market. Most people we know had to bid over to have their offer accepted.  A property that requires some love isn’t as appealing to as many buyers so we decided to only look for somewhat of a fixer upper so there was less competition. We ended up have our first offer accepted even though it was 20k lower than the asking price.  We had surveys done and the work needed is purely cosmetic but overall we got the propery for around 60k lower than the same properties in the street and surrounding area. 

Even if you don’t want to go down that route you will get something eventually.  Try and make sure you are seeing properties before they are officially marketed. 

Post # 4
Member
1370 posts
Bumble bee
  • Wedding: October 2017

Where are you located? I feel like that’s a big thing. 

Here, it’s so hard to get a house. My friends bought one and had to bid $200K over asking. Our other friends have been looking for months and keep getting outbid. 

Eventually, something will happen though. It’s hard and consuming but eventually works out. 

Post # 5
Member
1194 posts
Bumble bee
  • Wedding: September 2017 - Pearson Convention Centre

Not knowing which area you’re looking at have you thought about a brand new home. The price you see is the price you get

Post # 6
Member
1815 posts
Buzzing bee
  • Wedding: September 2018

We are in a very similar landscape right now, fortunately we were able to find a house and are closing in about a week. 

The first home we put an offer on we offered 21k over list price and a quick close and we were outbid. There were 8 other offers on the home. I would say my #1 tip is to have patience. Now that it’s moving into spring, there will likely be an increase in inventory which may stabalize the market a little more. 

We ended up getting our house for $5k over ask but I think we were lucky because the sellers of the house we purchased were extremely motivated. They listed it on a saturday evening, we jumped on it and went to see it Sunday morning and offers were due Sunday afternoon. And still, we weren’t the only offer. 

One month isn’t a ton of time, keep looking and don’t give up. You’ll find something but it might take you a little longer in a competitive market. 

 

Post # 7
Member
287 posts
Helper bee
  • Wedding: October 2016

imsandradee :  Girl I feel you! We were at it for a long time and we finally got one. We close on the 20th! But our offer was about 7 over asking prize with 30 days closing and there were 4 other offers, including a cash offer. It was intense! I think you just have to be patient and it’s almost like the stars have line up perfectly. I feel your pain though! Hang in there! With spring around the corner you should have a lot more options on the market. Good luck!

Post # 8
Member
609 posts
Busy bee
  • Wedding: March 2019

I work in the housing industry and the best advice I’ve heard is don’t get emotionally attached to any house. That’s not really reassuring, I know. Make offers like crazy on everything you can afford within the areas you’d most like to live. It’s just ridiculously competitive out there, and the people saying “I’m gonna wait for a recession to hit” are idiots. Inventory is currently so low because “improving” one’s living situation just isn’t a priority right now. A lot of owners are still trying to recover their assets from the last recession. Inventory on the market surely won’t increase if home values plummet again due to a recession, so there’s little point in waiting and hope you’ll come out ahead if our economy depresses.  

I feel your pain, we’re also very concerned we won’t be able to find a place to live next year. Get an aggressive Realtor who will make offers on houses on your behalf day and night and start talking to everyone you know about how much you want to find a house. You really never know who is thinking about selling and need a reason to be convinced. 

Post # 9
Member
903 posts
Busy bee
  • Wedding: June 2016

A month is really not a long time at all. I have friends/family buying in SUPER hot markets and it is taking them ~1-2 years with numerous offers to get houses.

HOWEVER, those that have landed houses are thrilled with their purchases. So it’s not like they ended up settling for below-expectation. It was just a matter of staying persistent and the right house worked out in the end.

In places like Toronto, Boston, SF where houses sell within (seemingly) hours at above asking price regardless of their fixer-upper state, it’s really a game of patience and determination.

But you’ll get out of your apartment and into a house, it’s just going to take more than a month and lots of rejected offers.

Post # 13
Member
4924 posts
Honey bee

imsandradee :  a lot will depend on your location. I’m in Boston and friends of ours were trying to buy in the Cambridge/Somerville/Medford area and it took them over a year and over a dozen rejected offers (all over asking btw) before they finally got a house. They paid over half a million for 1400 sq ft and it didn’t even have electricity so they had to add that before they could move it. Some markets are just absolutely nuts! They did have to waive the formal inspection, but they brought a contractor with them to the open house to do a less thorough “pre-inspection” to get some idea of the condition of the house. Definitely not ideal but that is the reality lately. 

I don’t know a single person in this area who hasn’t paid more than asking price. At least around here the days of thinking it over for a week and then giving a lowball offer to kick off negotiations are over. You have to move fast and come in with a high offer or you aren’t getting it. 

Post # 14
Member
903 posts
Busy bee
  • Wedding: June 2016

imsandradee :  The friends/family I have who bought in Boston actually fared better than Toronto and SF — so that’s the good news!

I think on average it took about ~5 rejected offers and ~6-8 months of very actively searching for them to get accepted offers. (vs Toronto it was more like 2 years and ~10-15 offers yell — I don’t remember specifics of SF only very frustrated friends lol)

Although it really varies on what area – the closer in/more desirable the suburb the harder it is obviously. Plus the level you’re going in at. I find the 450-700k is the hottest part of the market for Boston suburbs (i.e. just in and outside the Rt95 ring in metro-west or Cam/Med/Somerville areas). The 1M+ homes last on the market for slightly longer as there is a bit less competition.

All Boston-buyers I know all went in above asking with pre-approval and strong down-payments.

Post # 15
Member
1815 posts
Buzzing bee
  • Wedding: September 2018

Also, like PP @travelingbride31 mentioned, make sure you are coming in with a pre-approval, a strong down payment, and possibly a larger amount of earnest money. I feel like those are what set our offer apart from others. Another option is to waive the inspection but that is not really ideal in my opinion, we didn’t feel comfortable doing that BUT we did set a shorter inspection time-line, which I feel like is another bonus if you aren’t willing to completely waive the inspection.

Additionally, we used an accelerator clause in both of our offers. These are a little controversial from my research but they seemed to work for us. So, for example, if you’re bidding on a $400,000 house list price. You could put your offer in at $415,000 with an accelerator clause that states that you will beat any other offer on the table by $2,000 (or whatever amount) up to $430,000. Our real estate agent suggested we use this as it is a little more common in our area so it might be something to bring up to your Realtor. It seemed to work for us in our second offer (the home we’re purchasing) so it might be worth a shot.

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