It’s a great time to sell. Inventory is still at record lows and buyer demand is at record highs. Low mortgage rates mean this is the perfect time to upgrade or downsize your current living situation for an affordable price. That’s great news for sellers all around…..BUT, what about when you need to become a buyer? Below are a few common questions from potential home sellers in this competitive market.
What if I sell my home, but I’m unable to find a new one to buy?
Closing dates can be worked out in the terms and are usually quite flexible. Sellers have leverage in this highly competitive market and can be strategic when it comes to negotiating terms. Many buyers are offering free leasebacks, giving seller’s the option of staying in their home for a month or even two after the close of escrow. Assuming a standard 30-day escrow, this buys the seller 60 to 90 days to find and close on their replacement home.
Home prices are high right now. Should I wait to buy?
Increasing values don’t always equate to decreased affordability. The actual cost of housing reflects a person’s purchasing power, which is a function of mortgage rates, equity, and income. It’s not just price. You’ll likely have more purchasing power once you close the sale of your own home, which will give you a competitive advantage over other buyers for your next home.
If a lot of foreclosures hit the market, will that decrease home values?
This is a common concern about the end of forbearance and homes potentially flooding the market. Here’s why that’s not likely to happen.
Many homeowners have already successfully completed forbearance programs and are still current on their mortgage payments.
Learning from the past, many banks will negotiate modification plans with borrowers, which will enable households to maintain ownership.
Most homeowners are equity rich and will be able to sell – if necessary – instead of going into foreclosure.
As a seller, you’ll likely receive multiple offers, and see a number of different strategies buyers use to win. Perhaps the winning offer that you accept will inspire you to structure your own that way. With a little patience and a great agent, you really can experience a win-win in this market.
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