While markets can fluctuate from neighborhood to neighborhood, historically the holiday season is a great time to buy. Take fewer buyers actively looking, add motivated sellers with homes on the market plus attractive interest rates still out there, and you get a lineup for great conditions to buy. After looking at some houses on-line, and seeing some in person at an Open House, what's next?
Get preapproved for a mortgage versus prequalified. What's the difference? A prequalification over the phone with a lender can take about 15 minutes and asks basic questions about your ability to purchase. You'll receive a budget for the home that you'll be able to afford based on the information that you provide to the lender. For a preapproval a lender will gather much more detailed information, and depending on your personal situation, the process can take a few days or a few weeks. With this level of information gathered, essentially the only missing element is an appraisal of the home that you put an offer on. A preapproval gives you much more leverage and put you in a better negotiation position when you're ready to make an offer as compared to offers that have gone through the prequalification process. In this way, you are able to view houses with a greater confidence level that you will be able to close.
If you have a home to sell before you can buy a new home, sell your current home first. Put yourself in a seller's shoes. You find the perfect house, only you have to sell your house first and include that contingency in your offer. Say that same seller has another offer from a buyer with no home to sell. Which would you accept? An offer will be stronger if you don't have a house to sell. Until you have an offer on your house, visit open houses, view homes on line to clairify what it is you're looking for and focus your energy on getting your current house sold. No point in getting your hopes up on your "dream home" if you're not able to sell what you're currently living in.
Create a list of wants and don't wants to refer to when house hunting, and remember that there is no "perfect" house (NOTE: this is especially important if you are making a home buying decision with a significant other!) Looking at houses can be a lot of fun, and after looking at several houses they may start to blend together. We've discovered that it sometimes helps to rate each house as you make the tour based on your wants and don't wants. Sellers know that buyers buy on emotion ("oooooooh....it's soooo cute!!") To help to clarify your search, rate a feature in the house that you're looking for with a +1, and -1 for a non-desired feature. The house with the highest number would be your closest to getting the most wants met.
Remember substance versus style. Substance are things that you can't change: location, view, size of the lot, school district. Style are things that you can change: paint, paper, applicances, carpet versus hardwood. When you're looking for your next home purchase focus on the substance not the style. You can change the paint color and the appliances in the kitchen; you can't change the fact that you have an ocean view.
Find a great Buyer's agent and stop calling off signs in the yard. Interview agents and pick one that you feel will best represent you and understands your home buying needs. A Buyer's agent, who has a legal contract with their buyer clients, will notify their clients first if a new listing comes on the market, or schedule showings for her clients ahead of those who merely want them to open a door. Utilize their experience and knowledge of the market, and benefit from the service they provide.
A new home purhcase is an exciting chapter. By keeping emotions in check and offering some practicle tips for your house hunt, it will stay a home sweet home for years to come.
Melissa Rolland is a licensed Connecticut realtor. She lives in Tolland, along with her husband Todd, a licensed broker. Together they manage the Rolland Realty Group at Keller Williams Realty and can be reached at RollandRealtyGroup@gmail.com.