If you have been looking at homes for sale this year, you might be asking yourself: “Is this all there is?”
Throughout most of the DC metro area and Northern Virginia real estate markets, inventories are way down compared to last year. In Alexandria, the number of active listings has dropped 50%. Arlington has 35% fewer homes on the market. In the district, they are down 27%.
Because interest rates remain incredibly low ‒ the average 30-year fixed rate is around 4% ‒ potentially buyers are extra motivated to snatch up properties. The bottom line: it is definitely a seller’s market out there.
Feeling disheartened? Don’t.
While it is tough shopping for a new address when all the leverage seems to be on the other side, it is still possible to come away with a great home in Northern Virginia or Washington DC at a reasonable price. It just requires adjusting your expectations to fit a seller’s market ‒ and shifting your tactics a little.
Don’t Be Too Picky
Maybe your search criteria includes a breakfast nook, a fenced-in yard and a three-car garage. Pursuing a narrow list of features might make sense when there is a glut of properties on the market. It today’s climate, however, you might want to scale back on those demands. It still makes sense to keep certain “core” requirements that are non-negotiable. But finding a pad where every last detail matches your dream home is only going to lead to disappointment.
Adjust Your Bid
Buyers are always happier when they feel like they have walked away with a great deal. But in a seller’s market, you might have to re-calibrate what “great” looks like. Specifically, you might find yourself putting in bids above the asking price in order to get the house you want, something many people thought they would never do. The fact is sellers today often receive bids from more than one potential buyer, and the price is usually the primary factor in choosing one over another.
Obtain a Pre-Approval
There are a litany of reasons to get pre-approved by a mortgage lender. For one, it helps narrow your search by giving you a sense of what you can afford. But in an environment where for-sale signs are scarce, it also makes your offer a lot more competitive. Sellers want to know that if they accept your offer, it is not going to fall through because you could not secure financing. If another would-be buyer shows a pre-approval letter and you don’t, you are at a big disadvantage.
Be Reasonable with Concessions
Closing costs can range from 2% to 5% of the purchase price of a home. In some markets, buyers can ask sellers to share a little of that burden by covering a portion of the title insurance costs, attorney fees or loan origination expenses. Unfortunately, we are not in one of those times right now. Sellers have the upper hand, and asking too much can potentially scare them away.
Get a Helping Hand
Thanks to Internet listings, buyers have more control over the home buying process than ever before. But that doesn’t mean working with a seasoned agent isn’t vitally important. Real estate professionals who know the area can help you find properties that may not even be listed yet ‒ something that is especially important when there is a limited supply of properties for sale. Given their knowledge of the home-buying process, they can help you develop an offer that looks attractive to the seller while protecting your interests.
If you are looking for a home in Northern Virginia or the DMV, don’t let the seller’s market deter you. Look no further than the real estate team with more than 35 years of combined experience in the region. Pick up the phone and Talk to Ray!
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