The payment on a $700,000 property is 24% less today than in November, 2018.
November, 2018 @ 5% Interest = $3,758 payment
January, 2021 @ 2.77% Interest = $2,865 payment (24% less)
For buyers financing their property, timing the market is a bad choice. At 2.77% interest, it is far more likely that interest rates will go up than down. In the meantime, with ridiculously low levels of inventory, housing prices are not coming down anytime soon.
Instead of staying frustrated competing for a home in this HOT seller's market, it's time to see the glass as half full (if not completely full), and do what it takes to be the prevailing buyer in a possible bidding war. Here are our top tips:
Get completely pre-approved through underwriting so you can reduce the time you need for a loan contingency or possibly even waive it.
Reduce your inspection contingency days to 7. A good agent can refer an inspector who can get to the house quickly. No sense in dragging out the process unless something unforeseen is discovered.
Come in with a strong deposit - 3% of the purchase price is good.
Consider an escalation clause that states that you will increase your offer by $X over the next highest documented offer up to a certain max.
Be sure your agent writes a good summary email about the merits of your offer.
The best things in life are worth fighting for. Don't let a hot sellers market get you down. Fight for your next home or investment property.