Pre-approval for a loan can save time and headaches for buyers seeking a dream home in a seller’s market. Here are some other suggestions for overcoming the challenges of NOLA house hunting during the peak season.
How to Play the Game Differently — And Smarter — To Win Your NOLA Dream Home
A seller’s market is one in which there are more potential buyers than there are homes for sale. Following the law of supply and demand, this means that there will be fewer homes on the market, they will generally be priced higher, but will still sell relatively quickly.
But this doesn’t mean you can’t buy a home in New Orleans for a good price in a seller’s market — you just need to buy smart. Here are some of the ways you can overcome the challenges faced by buyers in a seller’s market:
Low Inventory
One of the biggest challenges buyers face in a seller’s market is the relatively low inventory of homes available for sale. This is the time when working with an experienced New Orleans Realtor is especially important, as a knowledgeable agent will know the exact moment (and sometimes even before) a home is officially listed for sale. Moving quickly will maximize your options, particularly when your options are limited.
Higher Prices
In a seller’s market, prices go up because sellers know they can ask more for their home when the supply is limited. But this doesn’t mean you should pay too much for a home, no matter how much you like it. Today’s seller’s market can become tomorrow’s buyer’s market, and waiting a short period of time can make a considerable difference. You should work with your Realtor to check the selling prices of comparable homes in the area to determine the real value of the home you want to buy.
Bidding Wars
Because bidding wars are common in a seller’s market, strong negotiating skills are vital to buying New Orleans real estate for a fair price. You might also need to be more flexible during a seller’s market — move up or back the closing date, pay part of the closing costs, or offer a larger deposit — but your Realtor will guide you on how much to budge during the negotiation process.
Pre-Approval
To save time and headaches, you should get pre-approved for a loan by a lender to assure the seller that the deal won’t fall through due to your inability to obtain financing. Pre-approval will provide proof that you can get financing for the home, give you advance warning about any credit issues you might have, and also tell you the maximum amount of money that you will be allowed to borrow. Your bank can also provide you with a “proof of funds” form to ensure the seller that you can cover the down payment.
Widen Your Search
If your favorite New Orleans neighborhood is suddenly out of your price range, consider checking out an up-and-coming neighborhood nearby, where the prices might be lower, yet you’re still in a desirable area. While a longer commute or a little needed renovation might turn off other buyers, these so-called issues might not be a problem for you, and allow you to find the house of your dreams where you didn’t expect it to be.
In the New Orleans real estate market, buyers currently have the upper hand, but the advantage is likely to swing toward sellers as spring approaches. If you will be seeking your dream home in that spring seller’s market, contact Satsuma Realtors for help.