For anyone buying a home in a hot real estate market such as here in the Silicon Valley, there is tough competition, which often results in a bidding war. The smart home buyer will strategically hedge their bets to become the winning bidder by planning ahead. Even after an offer is accepted, buyers should be aware of how some financial decisions could increase the chance of having their offer fall through.
As shared by the latest One Cool Thing infographic published by the California Association of Realtors® (CAR), you can give yourself the extra edge towards success if you avoid some commonly made buyer mistakes.
Our region continues to be at the top of buyer demand in residential real estate. This demand is made greater by the lack of supply we are currently facing. While there are ways a savvy buyer and their Realtor® can negotiate their way to a lower offer, when in a strong seller’s market such as ours, buyers are typically better off forgoing the low-ball approach. There are too many others who are willing to pay more, so chances are a low offer will be ignored.
This doesn’t necessarily mean you won’t find a home in a lower price range; yes, this region has some of the highest prices in the country, but there are cities and neighborhoods where you can still get a home for less than highest-cost market. Sacramento is a perfect example; this area is growing in popularity for home buyers partly because home prices are lower than other nearby locations. If buying in San Francisco is out of your price range, don’t shop for a home there.
The best approach is to determine your home price range, what you qualify for in a mortgage loan, and what you can readily afford to pay. Stick within your range when searching and you can avoid the disappointment of having an offer fall through after-the-fact, should it turn out you are not able to get the funding required.
To help ensure you get the best loan you can qualify for, and end up with loan parameters you can work with, there are two Don’ts to remember. Don’t make any large purchases before you close on a property. Once an offer is accepted, it isn’t a signal to go buy new kitchen appliances. A large expenditure prior to final approval could negatively impact your loan qualifications. Lastly, don’t forget to include closing costs, fees and taxes into your bottom line.
While a down payment helps lower the overall loan, there are still processing charges and other fees which come into play. There is also the ‘honeymoon’ phase of moving into your new home, whether you need new curtains, decide to paint each room or update the landscaping, moving in typically equates in money out, at least to begin with. Keeping these additional costs in mind can help you determine the ideal loan for your situation, and avoid a financially stressful situation.
When it’s time to buy, avoid common home-buying mistakes so you can find the right home for you, and enjoy it too. If you are ready to invest in property, buy or sell a home, we at Haylen Group are here to help you with all your real estate needs! As your agent, we will strive to work together and give you the best support we can. Call Helen Chong at (408) 800-LIST or email at Helen@HaylenGroup.com. You can also visit us at our website for available listings and additional information.