Residential real estate investment markets usually heat up during the spring and summer. That’s because families deem it ideal weather for a move. The fact that children are at home during summer break only helps with any decision to relocate and move to another home.But more recently, the spring-time market has been characterized by more supply and greater demand. While this has meant more competition amongst buyers, it has also served to drive up prices for properties.
If you are planning on making a purchase on property this spring, then you should spring into action now and get an edge over the competition. There are several ways you can do this. Keeping in mind the steps outlined below will certainly help. However, make sure you follow the advice of your Realtor carefully at every stage of the buying process.
- If working through a Realtor on your opportunity, be sure to pick one early on. Selecting a Realtor for your venture based on recommendations or referrals from friends or relatives might be a good start.
- Once you hire your Realtor for the ideal transaction, make sure you discuss your needs in great detail with them. Providing them even the minutest of details can bring you closer to owning the home of your dreams.
- Have the lending agency, funding your deal; pre-approve you for the maximum amount available. This will save you time later on, and will show sellers the seriousness of your bid. It also gives you an idea of the amount of money the bank will lend you for your contract.
- Work out down payment and closing costs for your dream residence. The National Association of Realtors (NAR) estimates first time buyers paid approximately 5% down in 2011, with the median being around 11%. You also need to factor in closing costs – usually between 2% and 7% – when costing the complete agreement.
- Be prepared to leap into action and make an offer as quickly as possible. Remember, your Realtor is constantly on the lookout for deals that meet the criteria you have discussed with them. A diligent Realtor will pass on information about a residential real estate investment opportunity as soon as they see it on the many listing sites they continually watch on your behalf. Making an offer quickly could improve your chances of owning the property.
- Be open to change. Some aspects of the home, like it’s location, proximity to conveniences like shopping malls, grocery stores and schools, and overall lot size, can’t be changed. However, be prepared to visualize changes to wall paper, carpeting or flooring, if your decision hinges on those items.
- Consider your Realtor’s advice carefully when making your offer. In a seller’s market, asking for additional concessions, such as price reduction for minor repairs, might lessen your chances of closing the deal for your ideal property. Sweeten the deal for the seller by agreeing to, or bettering their requested closing dates.
- Get a head start on homeowners’ insurance for your land by checking your credit history, since insurers will review that information before insuring your property. If you have filed insurance claims over the past 5 years, the Insurance Information Institute recommends you review your loss history reports, including your CLUE or A_PLUS report from Choice Point and the Insurance Services Office respectively. These highlight all your insurance claims for that period, and are a primary source for insurance companies to know your insurance history. Obviously, the better these reports are, the more favorable terms you can expect from home insurers for your home. For current renters, you should start looking at getting renter’s insurance at the earliest. Making this move will help build insurance history in preparation for your subsequent residential real estate investment.