A Team Homes By Ash Case Study – Buying a Home in a Seller's Market
Imagine saving for years so you could be prepared for one of the largest purchases - the largest investment you'll probably make in your lifetime. You saved — cut corners — cleaned up your credit. You did everything you needed to do so you could buy that perfect home with your partner in the perfect neighborhood with all the features you needed and wanted starting out. But, who could have predicted a couple years ago that a seller's market would have taken over and flourished through one of the biggest pandemic's we've seen since the 2009 H1N1 outbreak.
You still have goals of purchasing that home but there are a few additional challenges now.
You thought your largest hurdle was going to be coming up with a down payment and closing cost. But, with a steady seller's market - a lack of inventory in the market place combined with more buyers vying for those same houses, the timing is more than stressful. Things are moving quickly and demand is driving prices higher than you originally anticipated.
These are common concerns almost every home buyer is facing in the Twin Cities market these days. For Pam and Tony, the reality was no different, but they were determined. They waited years. They planned for this moment -- a year after they were married, and now with new careers in motion. But, the frustration and disappointment were slinking in.
They were looking at homes online, but every time they made a call to inquire about a home they were interested in, they were told the home was pending a sale. They almost felt like giving up — and then a friend of theirs referred them to our team.
We created a home buyer strategy to overcome the challenges ahead of them.
They originally planned for enough down to go with a conventional loan on average 3-bedroom home and have the closing costs covered. They had even done their research on the costs of inspections and homeowners insurance. But, the prices they were originally looking at were moving within hours after going on the market. Additionally, they seemed to be selling anywhere from $5,000 to $15,000 above the sales price being advertised.
We needed to expand their search parameters and do a reverse marketing search for them. Farming areas they were comfortable moving to in order to find the home they wanted close to the price they were looking at.
We also needed to make sure, before we started seriously looking that the couple was not only pre-approved, but they were certified as a Gold-star buyer; pre-approved and started on the underwriting process. In this case we not only got Pam and Tony a pre-approval letter to share with a home seller, but a letter of guarantee by the mortgage company that the couple could and would close - and close quickly.
We also prepped Pam and Tony on how to power negotiate during multiple-offer scenarios - which are not going away any time soon. We reviewed the most common sticking points when it came to multiple offers and gave them the tools to help them make some very quick strategic decisions when it came time to make that offer. Believe it or not, those sticking points are not always about price.
The great news...
Following the plan proved to be successful for the couple.
Because Pam and Tony followed our recommendations on working with one of our preferred lending partners, expanding their neighborhood location search, opened up their ideas about what was needed in a home at this time, worked with our team to find homes either before they went Active or as they became available, and were more flexible on timing and negotiating points, we were able to guide them through the process with less stress and ultimate success.
We helped them structure a very competitive offer – they knew exactly what they would and could include in that offer – making it the strongest offer possible, (which included a "dear seller" letter as an example). Their offer was accepted in short order and they were able to close and move into their new home within weeks.
Now, they have a place to call their own. They're working from home, entertaining a small, tight circle of friends in safe space of their own, and planning on an extension of their family in the coming months.
How Would Your Home Buying Goals Play Out Today? Let’s Talk.
Let Team Homes By Ash help you find and purchase your next home this year with our award-winning leadership and solutions behind you every step of the way.