What is Your Home Buying Strategy?

Seriously considering buying a home, or are already immersed in the process? You need to have a strategy, especially in this competitive market.

What IS your buying strategy?

Do you have one? Or are you going about the process haphazardly?

Consider the following:

INTEREST RATES

Interest rates remain historically low. Check into the programs you may qualify for and what this means financially vis-à-vis your monthly budget. It’s essential to create your own personal budget, because what you may qualify for and what you are willing or able to actually spend may be very different. And understand what waiting to buy can mean for you if prices, and interest rates, go up.

GET PRE-APPROVED

No matter how much is said about the importance of a pre-approval, many prospective buyers don’t seem to think this is important to do up front. Hellooo. You need to know what you qualify to borrow with today’s tight standards, interest rates, and your financial status. If you got pre-approved before it will need to be updated. If you are not yet pre-approved, be prepared to provide lots of paperwork to document your financial status for the underwriter. And guess what – not everyone gets approved for a loan these days.

CONSIDER ALL AVAILABLE HOMES IN YOUR PRICE RANGE

You need to understand today’s market and what homes meet your budget requirements. While you may not be inclined to pursue short sales or foreclosures, in your area or price point those homes may be the bulk of your options. So your strategy should not only consider these homes but you must understand the risks and the issues as a buyer. Consider all your options so you can make the best choice based on your needs and financial means, and understand the risks and implications of the distress versus the typical sales.

BE DILIGENT IN YOUR RESEARCH, BUT DON’T LET ANALYSIS CAUSE PARALYSIS

You need to do your research to learn about the local housing market (the inventory, what selling and what’s not, sales prices) and educate yourself about the areas you like, the purchase process, and other issues that are important to you (crime, schools, taxes, amenities). But don’t get so bogged down with searching on-line that you neglect the real world – explore the neighborhoods that interest you and drive by homes that appeal to you on-line – sometimes what you see on-line and the reality are rather different.

WORK WITH A QUALIFIED REALTOR IN YOUR MARKET

I strongly encourage you to work with a knowledgeable REALTOR, someone who knows your local market and can help you navigate the transaction, especially if you are considering short sales and REOs. Distress sales can be complicated and frustrating and you want someone who will be an advocate for you, in any transaction, and not be a paper-pusher. After all, buying a home is all about you, not your agent.

If you aren’t committed to the process a strategy won’t make a difference. But not having a strategy sure can hurt you if you are a serious buyer. You need to have a good idea of what you want to buy, what your needs are, and where you want to live. A strategy won’t do you much good if you don’t know what your ultimate goal is.