My buyers are frustrated. Buyers everywhere are frustrated. Home prices have risen about 10% from last
year and there just aren’t many homes coming out on the market. When there is a home, most buyers are outbid
or it has been sold already before they even get a chance to look at it.
Where is all this buyer
competition coming from?
For one, much of the buyer
interest is coming from investors. They
are either corporations pooling money together from the wealthy or private
individuals all looking to get a better deal than leaving their money in the
bank and let inflation eat away at their assets. Instead of working for the bank and getting
no return on their money while the bank goes out and makes interest on their
money, these investors want a better return and real estate is a very high
performing asset. Income properties are
generating a gross return of 5-15% depending on how much risk the investor can
handle. These investment homes are
picking up many renters who used to be homeowners and lost their home to the
bank but are used to the luxury of living in a house.
Now you see why there is such
an incentive for investors to snatch up real estate.
Investors are hard to
compete with. They usually buy with all cash
or a large down payment and that is hard to beat. Sellers love to accept offers with all cash
since that cuts the risk of a loan holding back the deal. This is good for sellers but tough for buyers
if they keep on waiting. The ball is
slowly shifting more and more in the seller’s hand. Home prices are only going to continue to
rise and buyers will find it even tougher.
I recommend being prepared
in this real estate market. Sellers should
start prepping their home for sale.
Pretty much have your home in a presentable condition and a simple and
convenient way to do this is with a fresh layer of paint. It really makes the house pop out a lot more.
Buyers should definitely
be prepared (proof of funds, pre-approval, know what you want) since it will be
tough. The best thing a buyer can do is
have their finances taken care of and make time for the homes they like. One of the worst things a buyer can do is
wait and miss out on an opportunity. So
I repeat, be prepared now so you can take advantage of an opportunity that might
come your way.
Feel free to contact me anytime
if you have questions, you already know how to get a hold of me.
