I just finished my Glendale Market Report for June 2013 and my last line was,
My advice for buyers is unequivocal. Buy the best house you can afford now. I do not see any upside to waiting. Interest rates and prices are rising and everyday you wait, you lose.
As I wrote those lines, my heart sank, just a little. I know how hard it is to buy a home in today’s market. I feel the panic with every phone call I get from a hopeful buyer.
Interest rates are rising. There are few homes on the market and the good ones seem sold before the sign hits the ground. All cash investors are edging out the normal folks and each house seems more expensive than the last. It is starting to feel like the dream of homeownership is slipping away. I am getting the hives just by writing this.
How can I compete?
Normally, my first bit of advice is to find the very best real estate professional you can. Interview a few at open house or formally, by making an appointment.
Today, however, the very best agents- the ones with the connections and skills that give you a critical edge- are completely overbooked with opportunity. It is a rare top level agent who is eager to work with buyers- we have a much better chance of being paid if we work with sellers.
Most of the agents who work with buyers are younger and less experienced. They might be terrific people who work hard- but hard work is often not enough. As a listing agent, if I have two similar offers and one is represented by an agent with a great reputation, I will inform my sellers of the benefits of working with that agent.
Here is what a top level agent loves to hear:
- I have an external deadline- lease ends, job starts, school registration, current home is sold
- I have large cash resources
- I am willing to release some, or all, of the normal contingencies
- I don’t need a tour guide, I need a solid negotiator
- I am committed to buying now.
Wow- bold stuff, I know. However, if you do not agree with most of these statements, it will be a difficult and frustrating road ahead.
What about working directly with the listing agent?
This is a valid game plan and one that can bring great success. However, it also means you will have absolutely no advocate on your side, incentivized to see things from your point of view. This does not mean the listing agent will lie to you, necessarily, but they have no reason (or way to know) if this house is truly in your best interests given all the other homes and options available.
What can you do if you don’t like the list above?
There are a host of eager Realtors just waiting to take you out to see homes. Pick one that seems brighter and more eager than the rest.
But, seeing homes and buying homes…. two very different things. If you are ready, really ready, to buy before prices and interest rates get any higher- consider my advice and work hard to get the attention of an A level agent. It won’t be easy, but it will make all the difference in the world.