If you’re looking to buy a home, right now could be a good time to consider buying. Home prices keep falling as homeowners try desperately to sell their homes, either to move elsewhere, or because they can no longer afford them. Even with the current real estate market being made for buyers, there are some things to consider before buying: prices falling, qualifying, and competition.
Right now there’s no way to know if the real estate market is going to get worse. Even though the housing market is claiming more homes are selling in late 2011 than earlier that year, that doesn’t mean that home prices are staying the same. As a buyer, that can be great, because it means more homes may be dropping into your price range. However, keep in mind that regardless of where or what you purchase, home prices may still continue to drop. So you might find your mortgage to be underwater early on. Keep that in mind when cruising the real estate market.
Qualifying for a home loan is tougher these days. With so many people defaulting on loans, and banks foreclosing on so many houses, the home lending market is more cautious. If your credit is less than decent, or you lack a down payment, don’t expect the loan qualifying process to be simple. Even if you plan on buying a home in a few years, when the market is on the upswing, don’t expect it to suddenly become easier. This housing market crash isn’t going to fade from memory for many years, so be prepared when you try to qualify for a loan.
Right now there aren’t a lot of buyers competing for homes, but the good homes will always have competition. Homes in good school districts, without a lot of flaws will always be sought after. And, if you happen across a home like this, especially if it’s a short sale (selling for less than what the owner owes on the mortgage), expect a lot of competition. Remember, home owners want the most money for their homes, with the least amount of hassle. If you happen across the perfect home, and there’s a lot of interest, it not the home to be nitpicky about, unless you want to not get it. Save the negotiating for homes without all the interest.
The current housing market isn’t great for homeowners, but for buyers it can be good. With the number of decent homes being sold as short sales, or as foreclosures, buyers that are prepared can pick up very good deals. But, any home can continue to lose value, and qualifying for a loan is tougher than ever. Add to that the number of buyers competing for the best homes, and anyone looking to purchase a home should think long and hard before jumping into the home buying market.
What kind of experiences have you had buying a home in this market? is there a lot of competition to own a home?