Top 5 Things You Can Do to Be a Successful Buyer in Today's Market
Unless you've been living under a rock, you've probably noticed that median and average home prices are skyrocketing. In fact, our Team Broady Founder, Libby Broady, has been in the business for over 33 years, and she has never seen a market like this before in her entire career! Of course, it's a great time to be a seller, but a very tough time to be a buyer. That's why we wanted to share our list of the top 5 things you can do to be successful in today's unprecedented market.
#1: You Must be Pre-Qualified
If you require a mortgage, you need to have an up-to-date, written pre-approval letter from a bank. The letter needs to state your entire purchasing power, not just your loan amount. For example, if the bank is willing to lend you $350,000 and you have a downpayment of $200,000, your total purchasing power is $550,000. If you’re a cash buyer, you must be able to provide a letter from a recognized financial institution demonstrating proof of funds.
#2: You Need to Know Exactly What You Want, But Willing to Compromise
When inventory levels are as low as they are now, you must be decisive. It's important to spend time figuring out precisely what you want, but you also need to accept the harsh reality of the market, and be willing to make some sacrifices. Many buyers want that fully-renovated, turn-key property, but quickly realize that they can’t afford those homes in the neighbourhoods they want to live in. This is where your priority list comes into play. If you really want that location near your kids’ school on a quiet street, you might have to settle for an unfinished basement, an original kitchen, or no garage. This is a tough mental exercise for most buyers, and one that usually happens only after they’ve lost out in a few multiple offers.
#3 Know the Market that You're Shopping In
Many people have no clue what type of market they're actually shopping for a home in. They don't realize that the asking price is actually much lower than the price they're going to have to pay in this market. Suppose you're shopping for a single-family home in Pointe-Claire, Beaconsfield, or even Vaudreuil-Dorion. In that case, you need to look for homes that are asking far less than what you're approved for. For instance, if you're approved for a purchase price of $650,000, you can't look at homes that are priced at $649,000. Instead, you need to look for homes priced around $599,000 or less, because you will most likely need to offer well over the asking price in order to get your offer accepted.
#4 Be Prepared to Act Now
We’ve worked with buyer clients in the past who were hesitant to purchase. They thought the prices were high and that it might be better to wait until next year to see what happens. BIG mistake! Now, the same house that they could have afforded last fall, for let's say $600,000, is now selling for close to $700,000 in the same neighbourhood. They have now priced themselves out of the market, and they can no longer afford the same properties in the same areas. Don't wait!
#5 Go Big or Go Home
This is the hardest pill to swallow. It's very difficult for people to wrap their heads around this concept. Imagine you're shopping for a house, your budget is $700,000, but you can only look at houses that are priced around $599,000 or less. We've seen houses in the West Island sell for $100,000 to $150,000 over the asking price! So, you've got to be pre-qualified and ready to offer that high in order to stay in the game.
We know it's not easy for buyers, especially when you get into a multiple offer situation, which is now the norm. You really need to be represented by a broker who knows what they're doing. Many buyers out there just write their best offer and their brokers simply email it to the listing agent while crossing their fingers and waiting. Unfortunately, they don't stand a very good chance of scoring their dream home this way.
Instead, if you want the best chance of succeeding, you need to work with an experienced broker who has a game plan and a strategy for pro-actively working those multiple offers. Luckily, Team Broady has been honing our strategic Game Plan for years! So if you're interested in finding out more about how we operate, don't hesitate to schedule your appointment today by emailing firstname.lastname@example.org or calling us at 514-613-2988.