Buying a Home in a Hot Market

Looking for a home in 2017 may require determination, a bit of luck and a firm grasp of basic principles, but it is not an impossible dream, even in a market with relatively low inventory and high demand. In fact, if you’re looking for home in the Fresno area, this may be a great year for finding exactly what you want — if you spend some upfront time getting your ducks in a row before wading into the buying pool. If you’re a first time buyer, you’re not alone. Actually, according to realtor.com,you will be in the majority in 2017 for the first time; 52 percent of home buyersare expected to be first timers this year, and 61 percent of those buyers areexpected to be under age 35. However, when there are more potential buyers than there are homes on the market, how can you maximize your chances of winning the bid for the home you want?

Set Yourself Apart

The same study notes that first-time buyers are concerned about the financial aspects of buying, and justly so, both the down payment and the monthly obligation. The best thing you can do — before you start looking at online home listings — is to consult with a lender as well as a real estate agent. Even though there are some handy guidelines to help you evaluate your finances,there is no substitute for a face-to-face meeting. Your ability to qualify for a mortgage will be determined by income, job stability, credit rating, and overall debt ratios. A pre-qualification letter is a first step, meaning that you have presented a lender with your pertinent financial data, and the overall prospect looks good for beginning a home search.If you are really serious about buying, however, take the next step: Get Pre-Approved. Complete the loan application – know exactly how much you can afford, the required down payment, and any additional funds you might need for moving expenses or repairs. Keep an eye on interest rates. Even though mortgage interest is expected to remain relatively low throughout thecoming year, some increases are certain. Even a quarter percent rate hike can make a big difference in monthly payment.The pre-approval will give you the confidence to act quickly and is a definite plusin a seller’s mind.

Don’t Look for Perfection

Especially in a tight or volatile housing market, prospective buyers are advised to be flexible when it comes to “move-in ready” properties. A recent study by marketing giant Zillow found that “more than half of all homeowners purchased a property that needed updates” and that only 18 percent ofbuyers found a home that had recently been remodeled. As you begin your search for a dream home in Fresno, you might also want to give yourself a “cheat sheet” so that you have a ballpark idea of what some popular home improvements will cost — whether it’s repainting a room, installingstylish new flooring, or replacing kitchen appliances or countertops. In addition to updates designed to save energy and personalize a home, exterior landscaping improvements are among the most popular homeowner projects. Weigh your priorities as you view potential homes; and be realistic about the kinds of projects you would consider. Over time, according to the statistics, a typical home buyer completes 6.7 home improvements. Reasons vary: Budget considerations at time of purchasesometimes necessitate improvements later, but updates also can simply be the desire to “make a house a home.”

Know the Trends

The more you know about your local real estate market, the more confidence youwill have to act quickly when you find an acceptable property. Based on pertinent statistics in our area, home prices will continue to appreciate, but at a slower rate than in 2016. Interest rates will trend higher in coming months, and availability will remain tight. It also helps to pay attention to national trends. Eight expert predictions, outlined in a recent Forbes article, provide interesting insights. Look for improvement in housing supply, but not abundance. It is likely to remain a “sellers’ market” for some time, say the pros, as demand continues to increase. Millennials will continue to fuel the expanding home buying market, but growing numbers will also look to renting as a lifestyle choice. Finally, competition is not expected to abate in 2017; if anything, average days on market of for sale homes is expected to decrease nationally for the third straight year. If 2017 is your year to buy, approach your home search systematically, with as much determination and flexibility as you can muster. Be prepared to act quickly; know that you will very possibly have to make multiple offers before you win a bid, and don’t get discouraged. Home ownership is still the American dream, and it is certainly attainable with theright preparation.