Five things to know about buying a house in this market
Navigating contingencies in a seller’s market
This post is sponsored by Kansas City Lifestyle
Attention current homeowners: Did you relate entirely too much to the recent SNL Zillow skit about lusting over property? Do you find yourself scrolling through listings and fantasizing about having more space and a bigger yard, but have no idea where to begin buying a house in a seller’s market? Well local real estate team, Samantha Salem of the Kansas City Lifestyle group with Reece Nichols, understands your pain. She has five simple tips for navigating the current market. Salem loves educating home buyers on the buying process in a time when houses are going faster than toilet paper in 2020.
Somewhat like the great toilet paper shortage of 2020, the current market is driven by a combination of factors. Low inventory, high demand, and low interest rates fuel the current seller’s market. Salem shares these tips to help buyers understand the process of all the moving parts while navigating selling and buying a house in 2021.
“In this market, buying the new house is the hardest part,” Salem says. “The good news is rates are even lower than two years ago, but finding and securing a house before someone else does is where it gets sticky.”
Here are her tips:
1. Do not try this on your own, unless you are a real estate expert
While Zillow scrolling can give you ideas for what neighborhoods and house features you want to explore, it’s not a one stop shop. There are so many moving parts when looking for your perfect home, and Salem advises working with a professional to help you sift through the weeds.
“We do this all the time for a living, so we are used to it,” Salem says. “We have a game plan to make this process as smooth as possible for you. There should be no shock factor when you have the expertise of a realtor guiding you through.”
2. Start with a free home consultation to evaluate the equity in your home.
Salem recommends having a realtor visit your house to see it in person. This allows the professional to compare your house to other homes on the market and suggest any repairs or updates to help your home sell faster. Some of the more significant equity builders include updated kitchens and bathrooms.
“I’ve seen updated kitchens that generate more than 100 percent of a return on investment,” Salem says. “When the bathroom or kitchen is already done, people will be willing to spend more on your home.”
For optimum saleability, they recommend painting your home in modern colors—whites, greys, and taupes—with white trim. Trendy colors also include deep navy or teal, and gold or metallic accents.
“Oak colored walls are out. The 80’s called and they want their shaggy carpet and their oak back,” Salem quipps.
3. Low interest rates will help you get the most out of your home equity.
According to Salem, this is a great market because you can sell your house top dollar and yet buy your new house with very low interest rates. Using the increased equity from the sale of your home increases the budget for your new house (most of the time). Cashing out on appreciation of your home can help some buyers find that dream home that, maybe a few years ago, you thought was out of budget.
4. Ask your agent which contingencies for which you might qualify.
A Contingency on sale of current property builds in extra assurances to the homeowners. They can allow you to establish that you would not have to leave your house until you secure your new home. It’s just an extra perk in the seller’s market that will help the homebuyer with a property to sell. With the current status of the market, make sure to reach out to an agent experienced with getting contingent offers accepted and coordinated for a smoother experience.
5. Make a plan to buy first and then sell.
Timing is everything, so make a plan to buy your dream home based on your latest home value. “If you buy first, at least you’re securing your dream house first. What you don’t want to happen is for your current house to sell too fast and then you don’t have a place to go,” Salem says. The value of your current home will be taken into account as a part of the pre-approval process for your new loan. You can work with the lender to put minimal percent down up front, and then once you sell your house, you can use the money for a higher principle reduction payment or recast.
Another reason this plan works well is that showing a home while you still live in that home is daunting. Leaving the house at a moment’s notice or cleaning up an unexpected mess makes selling a home you are living in a constant stress. When you buy your home first, there is more time and flexibility to move-in then sell your house.Of course, this schedule isn’t always an option when relocating for a job or other reasons, but we can work with buyers currently in the process of selling their home, and first time buyers without a home to sell.
Kansas City Lifestyle
She is an active agent with Reece Nichols Real estate in and around the Kansas City Metro.
Samantha loves representing buyers and sellers on a day-to-day basis, and considers building relationships an important part of her role as a REALTOR®. Samantha is a social media and technology devotee, and regularly holds workshops for buyers and sellers to help them through the process.
Born in New Jersey to a Palestinian father and Chinese mother, Samantha is knowledgeable in diversity and culture, she speaks both English and Arabic fluently and can help with any cultural or specific religious needs.
By keeping her finger on the pulse of the latest trends and movements of the Kansas City real estate market, Samantha is able to offer her clients top-notch guidance from start to finish, ensuring the entire process is seamless, efficient and rewarding.