Many people think, summer is the best time to sell a home, and in some areas it is usually the season when homes are the priciest. So we’ve put together these five summer tips for homebuyers to help them navigate the months ahead. Historically, many people have wanted to move while their kids were out of school, and have them ready to get started at their new school in the fall, so the summer market can be quite competitive.
As a home buyer in Shoreline, WA, you’ll find many homes for sale during the summer, but it’s actually not as busy as our Fall and Spring seasons. Many people in Shoreline, WA go out of town on vacation during July and August, so these tend to be slower months with less inventory available.
It pays, then, to know what to expect and the strategies to deploy to get the home you want at the best price possible. Read on to discover our top 5 Tips for Homebuyers shopping for a new Shoreline, WA home this summer.
1. Understand the Challenges Of Buying In Today’s Market
The first of our tips for homebuyers shopping for a new Shoreline home this summer is that they should have a good understanding of the challenges they’ll be facing.
The first challenge is that home prices are still rising. Although the rate of price increases has slowed, prices are, nevertheless, still going up. For example, in 2021, the “national median existing-home price climbed to $350,300 in May, up 23.6% percent from a year ago, according to the National Association of Realtors.”
Here in Shoreline, WA, median home prices are closer to $750,000 – and that includes condominiums and town homes, as well as single family residences. So this is a more expensive neighborhood than most out-of-state buyers will be used to, making it hard to afford as nice a home as you are used to, unless you are getting a generous salary bump as part of your relocation to this area.
If you want to know what the markets are doing, keep an eye on inventory numbers. As long as we only have a month or two of housing inventory, prices will continue to climb. If we approach a 5-6 month supply of inventory, we’ll be getting closer to a buyer’s market and we may see some price declines, but that is unusual for the Shoreline, WA area.
Another challenge with home price affordability is the steeply rising interest rates. And although mortgage rates reached historic lows not long ago, interest rates are now going up. And industry watchers expect this trend to continue unabated at least through the end of 2022.
What these challenges mean for you as a Shoreline home buyer this summer is that the expertise of an experienced Shoreline real estate agent will be more important than ever. To discover more about what a good agent can do for you, just call (206) 578-3438.
2. Get Pre-Approved For Your Mortgage Early On
Have you talked with a lender yet?
Another of our top tips for homebuyers shopping for a new Shoreline home this summer they should get pre-approved for a mortgage before beginning the house-hunting process. There’s nothing more disappointing for buyers than finding a home they love while browsing on the internet, but being unprepared to act on it because they weren’t pre-approved with a lender.
In today’s market, you essentially “have to” submit a pre-approval letter from your lender along with your purchase offer in order to be taken seriously.
“A mortgage pre-approval is a written statement from a lender affirming that you’ve qualified for a home loan on a preliminary review of your credit report, income, debt, and financial accounts. Including a pre-approval letter when you submit an offer on a house shows the seller that you’re a serious and qualified buyer.”
I call your pre-qual letter from the lender your “Golden Ticket” to the world of being a real home buyer.
With a pre-approval letter in hand, you’ll be perceived as a serious buyer and will, as a result, have far more negotiating leverage. Just be sure to compare shop lenders for the best deal, applying for pre-approval with at least three different lenders.
Here are the lenders I recommend and work with who offer great rates, customer service and can get the deal closed, even when things go a little sideways.
3. Make a “Clean” Offer With Few Contingencies
Before the real estate market was quite so strong, it was common for purchase and sale contracts to contain contingencies to protect buyers. But in the fast-moving market, buyers chose to waive contingencies and take more risk in order to make their offers more competitive and attractive to sellers. Now the market is cooling off again, we’re starting to see offers WITH contingencies come back in certain instances. But if you think the house you like will be getting multiple offers, it’s important to weigh the pros and cons of including contingencies carefully with your real estate agent.
If you want your offer to be as strong as possible, one of our tips for homebuyers shopping for a new Shoreline home this summer has to do with making an offer as “clean” as possible, that is, with few to no contingencies.
What Are Real Estate Contract Contingencies?
Contingencies are contract clauses that specify that certain conditions have to be met before the sale can go through. One common contingency is the Home Inspection Contingency which allows buyers to inspect the property, do a sewer scope, and call in experts if needed to assess the condition of the property and the buyers can ask the sellers to make repairs if they uncover problems during a property inspection. Another common contingency is the Financing Contingency, which requires that the buyer’s mortgage get approved before they’re obligated to close on the property. If the buyers can’t get a loan despite their best efforts, their earnest money would be refunded and they could walk away from the deal.
Occasionally, you’ll also see people requesting a Home Sale Contingency allowing them to close on the sale of their first home before they will buy the new home they’re making an offer on. This has been almost unheard of for the past few years, since the market has been so hot.
When sellers are getting multiple offers, buyers have less room to require contingencies. As a result, sellers prefer a so-called ‘clean’ offer that waives contingencies.
Still, contingencies can protect you as a buyer. Be sure then to consult your Shoreline realtor at (206) 578-3438 before waiving all contingencies in your offer this summer.
4. Know the Local Shoreline, WA Real Estate Market
We’d be remiss if we didn’t include among our tips for home buyers an admonition to know the local market. Local markets vary widely, so you need to know what’s going on in the Shoreline market this summer. Here’s what the experts recommend . . .
Home prices growth slowed drastically this Spring as interest rates shot up, cutting into buying power for many home shoppers. Some homes languished on the market and had to drop their prices. Others still sold with multiple offers.
Housing market behavior is very localized, so get to know the one where you’re hoping to buy. It also varies by price-point and house type (condo, townhouse, single family home), etc.
Again, this points up the importance of working closely with an experienced Shoreline agent. So here’s the homebuyer tip: Don’t go it alone. Get some help from someone who is in the market and seeing these trends, staying on top of them from day to day, and week to week.
5. Work With the Right Mortgage Lender and Real Estate Agent
And this leads to the last (and most important!) tips for home buyers: making sure to work with the right lender and agent.
Since the market is so strong, you should get pre-approved in advance with your lender. Then, they can prepare a letter specific to the property you are making an offer on, that you can submit wiht your offer. This often needs to happen with short notice, especially if you want to make a strong “early offer” on the night or weekend when you first discover the house you like. Working with a loan officer who is available nights and weekends is especially important. That’s why I keep a list of vetted lenders I have a good relationship with, who will be available to you, and who can get the business closed.
In addition, finding a real estate agent who has a strong relationship with other agents in your market is critical. Having a firm grasp on the data and trends in the market you’re interested in is important, too. And not often something that gets discussed.
If you’re shopping for a Shoreline home this summer and want to get the best deal possible, contact us today for more tips for home buyers.