Buyer’s Market: How to Take Advantage of a Buyer’s Market
8 Great Reasons to Buy a Home in Today’s Market
When it comes to buying a home, timing it right is up there with location as a key consideration. Catching a housing market in transition toward the buyer’s advantage – as it is in many areas today – can save you a lot of money or allow you to buy more home for your budget. Your buying power may never be greater than it is today.
Of course, markets vary from one region to another. But if you’ve been seeing sales prices leveling off or dropping and the inventory of home for sale growing, that signals the presence of a buyer’s market. The real estate market today has come full circle.
People thinking about purchasing a home don’t always take advantage of transition markets. Some decide to wait and see whether prices and/or interest rates drop further – which may not happen. In fact, when a market moves toward the buyer’s advantage, prices sometimes don’t drop at all – they simply stay at current levels. That’s still a great time to purchase a home – getting in before prices or rates start to rise again.
Buying a home now may make perfect sense for you. Consider the advantages of today’s market.
- Better Prices
With more homes on the market waiting for buyers, sellers don’t expect to see the appreciation rates they had grown accustomed to. Some even drop their listing price below market value to attract attention and speed the sale in order to meet a moving deadline. Bidding wars and escalation clauses no longer threaten to take a home’s sale price beyond its true market value.
Homeownership: A Proven Wealth Building Opportunity
We all have to live somewhere. Putting your housing budget to work with a home investment – rather than throwing it away on rent – makes good sense for most people in most markets. Although there’s no guarantee a particular home will appreciate year after year, history has shown homeownership to be a long-term investment that builds wealth for most people. Not only can you live in the home while it helps your wealth grow, your own home offers pride of ownership and a secure sense of place in your community.
- Negotiating Advantage
In a buyer’s market, sellers must show more flexibility not only on price but on the terms of the contract. Buyers have greater pull when it comes to negotiating contingencies – e.g. for inspections, financing, sale of a home, etc. – and other particulars, such as move-in date, what conveys with the home, who pays which closing costs, and so on.
- More Choice
With more homes on the market, buyers don’t have to “take what they can get.” These days you can pick and choose from a variety of homes in the area.
- More Time to Choose
Since there are fewer people out there looking for homes compared with the number of homes for sale, buyers can take more time searching for appropriate candidates and comparing them. You don’t have to rush into a decision for fear the home might immediately slip away to another buyer within hours.
- Homes in Great Shape
When buyers are harder to come by, competing sellers spend extra time and money making sure their homes are in tip-top shape before they hit the market. That means buyers get to move right in without the hassle or expense of repairs or improvements to update the home.
- Extra Incentives
In a buyer’s market, builders, developers, and private sellers sometimes offer “sweeteners” to attract attention and close a deal. Today’s buyers may find the home they want comes with seller financing, a redecorating allowance, choice of new carpeting or paint color, landscaping services, an extended home warranty, a year’s worth of free utilities, paid homeowner association fees, a vacation in the tropics or some other money-saving bonus.
Experts advise that some incentives are better than others. To take best advantage of a buyer’s market, negotiate for “extras” that actually put money in your pocket or keep it from slipping away. A deal that lowers your payments, closing costs, or first year’s utility bills is worth more in real terms than an exotic trip, which could end up costing you money.
- Attractive Financing
As fewer buyers apply for new mortgages, mortgage lenders compete for business by offering more generous loan terms. Not only are interest rates still low by historical standards, buyers today can take advantage of offers including lower closing costs, waived fees, free rate locks, faster loan approval and speedier processing. As in recent years, of course, today’s mortgage industry offers a wide array of loan programs you can choose from to meet your particular financial needs and goals.
- Immediate Tax Savings
The sooner you purchase a home, the earlier you can take advantage of Uncle Sam’s generous mortgage interest tax deduction, which in effect subsidizes your payments – or shelters your income, depending on how you look at it. Tax law favors homeowners in a number of other ways too. You can take deductions for points paid on your mortgage loan, qualifies home-office expenses, expenses associates with investment properties, and more. Finally, when you eventually sell your primary residence, you can qualify to keep up to $500,000 in profits tax free if you are married filing jointly, $250,000 if you are single.
Make a Smart Choice
In any market, timely, accurate information from knowledgeable professionals is the key to making the best possible investment decisions. Call us to find out how you can maximize your position in today’s real estate market. We’ll keep you up-to-date on all the latest developments and opportunities , and work with you to take best advantage of them. We look forward to serving your needs!
More Ways to Save Thousands Buying a Home in Today’s Market
Today’s market presents a host of opportunities – those that often sell for less than their true worth on the market. Some of the best deals can be found in:
- Pre-foreclosures: Owners who are over-extended on their finances often need to sell their homes quickly in order to avoid foreclosures
- Estate sales: Settling an inherited home may be more important than getting top dollar for families who wish to finish the estate distribution process quickly.
- Corporate relocations: Companies that purchase homes from their transferring employees often find that selling these homes at lower-than-market prices is less expensive than carrying them longer on the books.
- Builder close-outs: Although builders may not discount the last properties for sale in a development, they often throw in valuable extras such as amenity upgrades, free landscaping, and so on.
- Investor sell-offs: When investors are ready to shift their money to other investments or markets, they are sometimes more willing to drop a home’s price in order to liquidate their equity quickly.