Getting ready for the 2023 home-buying season
Given current conditions, home buyers will have a little more bargaining power during the upcoming prime buying and selling season. There should be a little more inventory, which will ratchet down some of the competition. Sellers are increasingly discounting their asking price. If mortgage rates stabilize in the six percent range, housing will become more affordable for many buyers.
Most experts look for sales to settle in pretty close to the 2018-2019 pre-pandemic level. That’s about where they were in November.
There has been a slight price decline, but the outlook is for a modest increase next year. Of course, that’s if the economic conditions continue tracking at the current level. Meanwhile, there are some important things buyers can and should now be doing.
DO YOUR HOMEWORK
Many are surprised at just how much local market information they can find. The Northeast Tennessee Association of Realtors® (NETAR) offers an array of market updates and insights that can be found on its website at www.netar.us. Getting a firm footing on local conditions as opposed to what you see in mass media is important because real estate is hyper-local, and most mass media coverage is focused on major metro areas. For instance, according to the media, the current median single-family existing home sales price is $329,000. But the actual number here in the Tri-Cities is $225,000. There is a graphic on the NETAR site and its Facebook page that breaks the price down by 17 city and community submarkets every month.
LOAN AND MORTGAGE OPTIONS
After you get pre-qualified by a lender, check out mortgage loan programs for one that fits your pocketbook and needs. Some lenders have special programs for first-time buyers. FHA, USDA, and VA loans are also viable options. Each has different requirements and advantages.
PARTNER WITH A LOCAL REALTOR®
Finding and partnering with the right professional Realtor® can make or break the home-buying process. Realtors® are pros at helping their clients navigate the local market, looking at homes, and steer them through the negotiations and closing. It’s a good idea to interview several agents to find one you’re comfortable with. And there’s nothing wrong with asking for and checking references. Some agents specialize in first-time buyers, others have a specialty that accommodates elders. The list of specialties is long, and it’s good to do the research and find the best agent for your needs.
TEMPER YOUR EXPECTATIONS
While mortgage rates are expected to be in the five-and-a-half or six percent range, they can vary. There are many good mortgage calculators online that will help you keep your monthly mortgage commitment in your affordability range. And don’t forget about closing costs, the price of a home inspection, and moving expenses. Be prepared for the surprise costs that always seem to pop up.
Most experts urge buyers to keep their total monthly housing cost to 25% or 30% of their income. Everyone likes to tour their dream home, but wishful shopping above your financial ability is both time-consuming and frustrating for everyone concerned.
BE PERSISTENT AND PATIENT
Remember Murphy’s Law: Anything that can go wrong will go wrong.
There are typically bumps in the road of home-buying journeys. They come as unexpected costs, delays, or disappointments. The secret to getting past them is patience and persistence that if it can be fixed, it will. If not, there are other options.
Buying – or selling a home – is not a typical business transaction. That’s why having the right professional Realtor® who has the time to hold your hand and get you over the rough spots is so important. Finding an agent you trust and feel comfortable with is the key to a positive real estate experience.
NETAR is the voice for real estate in Northeast Tennessee. It is the largest trade association in the Northeast Tennessee, Southwest Virginia region, representing over 1,600+ members and 100+ business partners involved in all aspects of the residential and commercial real estate industries. Weekly market reports and information for both consumers and members are available on the NETAR website at https://netar.us