Buying a home in spring can be tough. Here are some things to consider if you are planning to purchase a home during a very competitive time in real estate.
Whether it’s spring or fall, summer or winter, prospective buyers will always hear drawbacks and perks to house hunting during that particular season. Winters in the greater New York City area are cold and, in year’s like this, mountains of snow can make the exploration process particularly challenging—but many espouse the great deals to be had in exchange, due to the decreased competition and stronger desire of sellers to finalize the deal. And now, with the spring real estate market upon us, insights, tips, tricks and plenty of marketplace trends are bubbling to the surface. So what’s fact and what’s fiction? Yes, spring is a particularly competitive time in residential real estate, with more buyers who need to be moved in ahead of the all-important first day of school. But, on the flip side, the inventory skyrockets when the weather heats up, meaning more, more, more for the prospective buyer to take in. Here’s how to tackle the spring market, and what to keep in mind as you’re beginning or continuing your house hunt!
Mortgage rates are low
Rates for 30-year fixed rate mortgages have been hovering in the 3.6-3.7% range, with 15-year loans around 2.9%. While rates have risen slightly, they’re significantly lower than in 2014, meaning more new buyers will be pounding the pavement of suburbs around the area come spring. More competition? Maybe. But also a great opportunity for your family to lock in a low-rate mortgage and, as a result, even more bang for your buck! Remember, a 1% change in a mortgage rate can mean $400-$500 per month on an $800,000 mortgage, and over $160,000 during the life of the loan.
Be prepared to make an offer—fast!
You’ve spent time exploring communities and towns, and have homed in on an area that’s right for your family. You’ve carefully assessed your “must-haves” and “nice-to-haves,” and know exactly what you’re looking for in a home. So when you see it, bid! Stories of offers coming in during open houses or within the first day or two of appointments aren’t exaggerated, especially in the spring market. You know what you’re looking for—so when you see it, don’t be afraid to make an offer!
And be prepared to revise your offer
The last two years have seen spring bidding wars in the marketplace, especially in popular suburbs. Your agent will help you navigate these sometimes-challenging waters but, remember, if you love a home be prepared to revise your offer. Sometimes a small tweak to your bid—a 1-2% increase, a slightly higher down payment, accepting an element of the home “as is”—can make all the difference, and does little to your own bottom line.
Above all, make sure you’re pre-approved
Even if you have excellent credit and significant savings and investments, getting pre-approved will expedite your home purchase process, and assure sellers you’re a serious, able buyer. Given the average home prices in this area, there can be additional hurdles to navigate, from jumbo mortgages and their unique terms to higher than expected closing costs and tax payments due at signing. Working with a qualified mortgage loan officer at a reputable bank or credit union will ensure you’re informed and prepared when offer time comes. And if your search takes longer than you initially anticipated, be sure to have your pre-approval offer updated throughout the process so it’s 100% up-to-date—your letter will have an expiration date on it, so be sure to revisit as it gets closer.
The spring real estate market is here. If you’re looking to make a move in the next few months—or need to be settled come the first day of school in September—now’s the time to get pre-approved and get searching! By preparing yourself—your finances, your priority lists and your town know-how—you’ll be ready to tackle the spring market like a pro and, no doubt, will find your perfect home in your perfect suburban community!