Whether you’re actively searching for a home or just testing the waters, jumping into a hot real estate market can be stressful. There’s a sense of urgency to act quickly, but it’s important to stay cool under pressure and avoid letting emotions drive your decision-making. Here are some tips for buying a home in a competitive market:
- Find a good real estate agent. Working with an experienced agent is an important first step. It pays to work with an expert who knows how to navigate changes and challenges in the housing market. That’s what you can count on when you partner with an agent in the RealtyPlus® network.1
- Work with a loan officer you trust. Choosing a lender with a proven track record for quality service makes a difference. Your loan officer can guide you through the financial aspects of buying a home and applying for a mortgage. They can help figure out how much home you can afford and prepare all the documents you need early in the process.
- Get a preapproval letter. Getting preapproved for a mortgage puts you in a strong position to make an offer on a home. A preapproval letter from a reputable financial institution shows that you’re a qualified buyer ready to close the deal. When you request a preapproval letter, you’ll provide information about your income, assets, debt and employment history. We’ll ask you to provide supporting documents later on to verify this information. Gather these ahead of time so you can give them to lender and move quickly through the mortgage process. They may vary depending on your situation, but common ones are W-2s, paystubs and any other income for the past two years, bank statements and investment account statements and monthly debts including auto loans, student loans, and credit cards. You’ll also need to provide proof of ID and your social security number.
- Set your priorities and be ready to move fast. Work with your real estate agent to identify the top features you want in a home—and where you’re willing to compromise. And, to prevent becoming attached to homes that have already come and gone, Consumer Reports suggests searching listings on Tuesdays and Wednesdays. Because deals are often made over the weekend, listings are updated at the start of the week. This will give you a more accurate idea of what’s available. Your real estate agent also has access to the latest listings and can notify you when new homes hit the market. When you find a home that meets your criteria, be ready to act quickly to make an offer.
- Make a strong offer. A good real estate agent will find out how much homes are selling for in the neighborhood and reach out to the seller’s agent to find out what’s important to the seller. Doing this research can give you an edge when it comes to making a competitive offer. It’s a good idea to discuss your strategy for a counteroffer so you’re prepared for a range of scenarios. You can also ask your agent about pocket listings. These are listings that are more informally marketed by word of mouth and shared among agents in the same office.
- Be patient. Resist the urge to make decisions based on emotion or get carried away in a bidding war. Decide on your maximum bid ahead of time and be prepared to walk away if bidding goes beyond your financial comfort zone. Consumer Reports' survey found that 44% of homebuyers said they had to make offers on 2 or more homes before one was accepted. Sometimes waiting can give you the perspective you need to move forward when the time is right.
Your Home Search Starts Here
Is a new home in your future? Navy Federal Credit Union is here to help, and we’ve partnered with RealtyPlus to help you choose a top-performing real estate agent in your area. Get started with RealtyPlus today.1
In order to fully benefit from RealtyPlus services, you must be referred by RealtyPlus before contracting with a real estate agent and be represented by the assigned RealtyPlus real estate firm and agent at closing to qualify. Standard listing fees apply. Contact RealtyPlus for terms and conditions.↵
This content is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.