One thing I’ve learned in almost 20 years of real estate is that sometimes, the weirdest markets harbor the best opportunities to buy. The key, of course, is approaching these atypical situations with the right mindset and information. Here are my five tips for buyers looking to enter the market amid these unusual circumstances:
1. Get pre-approved. This may sound like a broken record playing, but I just can’t stress this point enough. The trouble isn’t that you won’t find a loan if you wait until it’s time to buy to start the process—it’s that you likely won’t find the right loan. Perhaps something in your financial picture changed and you weren’t aware of it.
It’s especially important to get pre-approved in this era of COVID because many listing agents are now expecting buyers to produce a pre-approval letter before they come see the house in person. This is a strict policy, but it makes sense; they want to make sure that only the most serious, qualified buyers are entering their seller’s home in this time of heightened health risks.
2. Mask up! I know we’re already hearing it in the news and from friends and family, but as a homebuyer, you need to be prepared to wear a mask, gloves, and shoe guards. You should also expect to use plenty of disinfectant and refrain from touching things in the home as much as humanly possible. You have to operate in this capacity and respect the protocols; it’s as simple as that.
3. Inventory is low. You may expect to see twenty or more homes fit your criteria in the Portland metro area, only to discover that that pool is only four or five houses deep. In most cases, we’re still in a seller’s market. There are some areas around Portland where we’re starting to see some softening (i.e., inventory and days on market are on the rise), but we’re firmly in a low-inventory market on the whole.
4. Interest rates are low. Right now, rates are hovering around 3.1% (depending on the day of the week), and that is free money! As I’ve mentioned, I’ve been doing this job for a long time, and when I got into the business, rates were at 9%. Let’s be honest—most of you have never seen rates that high and would fall out of your chair if you saw them hit 9%. So, if you’re even remotely considering buying something, you’d be hard-pressed not to make a move now. Buying power has never been stronger, and I actually took advantage of rates myself in the form of a refinance.
5. Get expectations and formulate a strategy. In some areas of town, and in certain prices, you have to be ready to rumble. Multiple-offer situations are just a reality of our market, and you need to devise a game plan for how to win out so you don’t end up exhausted from the process. Conversely, there are some parts of town where property is moving fairly slowly, giving you the wiggle room to negotiate. That’s why it’s critical that your strategy be reflective of your price point, location, and other needs.
Most of these tips aren’t necessarily ground-breaking paradigm shifts, but nonetheless it’s now more important than ever to remember them. If you have questions about the market or getting pre-approved, need a lender recommendation, or anything else, please reach out to us by phone or email. We’re always happy to help.