Q: Any advice for buyers looking to get into the real estate market right now?
A: My first tip- Just Do It. it is rarely a bad time to invest in real estate. Trying to time perfectly the ups and downs of the market has the effect of keeping you out of the game- getting in is the most important part. With today’s mortgage rates now at historic lows, you should not wait. Buyers are still able to take advantage of the current market, emerging from the previous year’s slowdown. Prices are not at the highs they rose to in spring 2018, although many buyers are wisely getting a jump on things before this year’s spring buying season.
Because of the low mortgage rates, many buyers are finally able to qualify for the loans they need to make their first purchase. This has markedly increased demand in lower price ranges- throughout Los Angeles, anything under $700,000 (yes, there are some nice neighborhoods in L.A. where this is still possible!) is currently receiving multiple offers and stiff competition for interested buyers. In our Argonaut reading neighborhoods, that entry level mark is more like $1.5M, a price range where we are also seeing multiple offers. The higher priced homes in our area are also getting a boost, however, as many people sell their first homes, qualifying to upgrade their lifestyle! With all of these buyers out there, it’s a great time again to get your house on the market.
While most of the buyers I work with are avidly searching the internet and receiving alerts when a property fitting their criteria comes on the market, they have me on speed dial during the process. I do strongly recommend that you find an experienced real estate broker you trust in advance, rather than scrambling to pick one when you find a property you’d like to offer on. I have had many articles published regarding the perils of dual agency, and please do not make the mistake of believing you are gaining an advantage by allowing the listing broker to represent you. If you hear nothing else, hear this. You deserve a broker who can completely honor their fiduciary duties to you, and whose duties are not split between you and the seller. It’s not just about negotiating the price, it’s about having undivided loyalty to you at all times during the process.
So- have your own broker on standby. Continue going to all of those open houses on your own and have your broker arrange private showings. Certain home search websites lead prospective buyers to believe that they are scheduling a showing directly with the property’s listing agent, when instead they are simply being turned over to an agent who pays that site for leads.
Here are some additional tips on how to buy your dream home now:
1. Be patient and prepared- See as many properties as possible. Prequalify with a lender so that you can count on a pre-approval letter being ready to submit with your offer. Being prepared and informed on your local market will ensure that you know the right property and its value when you see it.
2. Make an attractive offer- Don’t be intimidated by a competitive market. A competitive price is not the only way to gain advantage over other bidders. While not everyone can make an all cash offer, waiving their loan and appraisal contingencies, I often ask for and receive expedited loan processes for my clients, allowing for a faster closing and an earlier release of contingencies, something that is of the utmost importance to most sellers, financially committing the buyers to the deal.
3. If you make an offer but lose it to a higher bidder, MAKE A BACKUP OFFER!! Why do so many people shy away from this? Don’t let pride keep you from getting the home you want! So often, properties fall out of escrow, and you are back to competing in the next round of bids rather than having already secured your position.
Buyers, now is your time! Financing is so cheap it’s practically free, so take advantage of this opportunity to make a critical investment in your future, finally get that ocean view, great backyard, or walk-in closet you have been dreaming of!
Disclaimer: This article is intended to be primarily for entertainment purposes and is not to be considered legal advice.
ABOUT LISA PHILLIPS, ESQ./ CA Dept. of Real Estate Broker License #01189413
Lisa Phillips is a Realtor in the Los Angeles area, with close to 25 years as a real estate broker and attorney and is a Broker-Associate at Lotus Estate Properties in Marina del Rey. Lisa is a member of the National Association of Realtors “Green Resource Council” and achieved its “GREEN” Designation. In addition to her real estate and business savvy, Lisa is passionate about helping others, actively volunteering in the community and donating a percentage of all sales commissions to charity. For more information, please email [email protected]