Weird, Wacky Times in Real Estate

by on May 16, 2011

These are the times that try men’s, and women’s, souls right now when it comes to real estate.

Why?!? Well you no sooner find a house that everyone likes and you call the other agent to see if there are any other offers only to learn that they have stopped taking offers as they just have to many to sort through.

What’s really weird is when this happens with a property that has been sitting on the market for 30 to 60 days with relatively no activity and all of a sudden they get three offers on the home on the same weekend. How does that work?

The bottom line appears to be a lack of inventory. The best houses sell within days of coming on the market. In the meantime, the not so great houses get ignored. Finally, the home buyer, in an effort  to not have any competition, decides to check out a few of these, ‘not so great’ homes in an effort to find a ‘diamond in the rough.’ Only that seems to go in waves. Hence, the competition ‘out of the blue’ on properties that up to that point sat neglected by the market.

So, what can a buyer do?

Number 1, Do NOT get attached to the outcome. If you win, and get your offer accepted, great. If you lose, just move on to the next one, like it’s no big deal. ‘Water off a ducks back!’

Number 2, look for properties that are NOT at the top of your range. Give your self a little negotiation room if you get in a multiple offer situation. Don’t be upset if you get a counter offer. Look at it objectively and respond appropriately.

Number 3, be willing to look at short sales. Yes, it will probably take a little bit longer to close, but the upside potential on these far out-weighs the downside on inconvenience.

Number 4, continue to set money aside so that you have even more buying power, or the ability to fix up one of the ‘diamonds in the rough.’

Number 5, get educated on the new loan programs out there like the FHA 203(k) which allows you to pick up a property that needs some work and finance the cost of the repairs as part of the loan. It’s like getting paid to improve the home. Or, the USDA loan which allows you to finance 100% of the purchase price is some communities, usually in a farm area. For us here locally, that might be Salinas or Mountain house.

The bottom line is to work with your Realtor to map out a strategy that works for you. You’ll be glad you did when you get the keys to your new home!

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