House hunting can be a daunting task for anyone who’s looking for a house to buy.
Whether you’re looking to buy a house as an investment or to simply live in it, the current state of the real estate market is making it a bit tricky to do house hunting due to an increase in demand and shortage in supply.
In 2017, the US real estate market is suffering from a slight drop in house supply, especially entry-level properties, compared to previous years. This, combined with an increase in demand, is making house hunting a more challenging task, and it is forcing house hunters to lower their standards when trying to find a home.
On the bright side, here are listed a number of tips and considerations to use while house hunting in the hopes of making the task easier and less scary for you as a potential real estate investor or home buyer.
Get Your Mortgage Pre-Approved
If you’re house hunting, then you’re considering to buy a real estate property. If you’re buying a real estate property, then you will probably need a mortgage. But in order to seal the deal on the best offers available to you, and in order to gain an advantage over other potential buyers, before making an offer on a property for sale, make sure that you have pre-approval on your mortgage.
Related: Tips For Getting a Mortgage For an Investment Property
Some people pay a visit to their mortgage lender prior to making an offer to buy a property. However, most people think it is sufficient to get a verbal verification from their lender that they are prequalified, which does not provide as much credibility to the seller as you might think. Instead of getting verbally “prequalified”, ask your lender for a pre-approval on your mortgage. This means that your lender will run a credit check on your account, verify your income, and authorize the loan with the set amount of money.
This gives you an advantage over other potential house buyers who might also be house hunting by giving you higher credibility with the seller, and it indicates your level of seriousness when it comes to purchasing the property for sale.
Offer Values Beyond the Price
When house hunting, try to make offers that are attractive for reasons more than just the price. Be friendly with the sellers. Build a relationship with them. Take their requests into consideration, even if they do not offer you any direct benefits.
If a seller asks you if it’s okay to leave his/her dog house behind in the backyard, don’t refuse… even if you don’t have a dog. You might want to figure out a way to take care of it later, but in the meantime, this builds a trust relationship between you and the seller, giving you an advantage over the other house hunters out there.
Additionally, in areas with low supply and high demand, house hunting is becoming increasingly competitive, leading some buyers to pay certain extra expenses just to appeal more to the sellers.
In Seattle, for example, buyers are starting to conduct pre-inspections of the real estate properties for sale that they’re interested in at their own expense. Doing this means that you would have to eliminate the inspection part from your offer’s contingency clause (you cannot claim the expenses of hope inspection/reparation after closing the deal).
This can be very expensive for buyers if they end up making multiple offers, as for each offer they make they will have to first pay the pre-inspection fee, which could range anywhere between $150 and $800 depending on the type of inspection.
This is only one of the many examples that can be given when it comes to competing with other buyers during your house hunting journey.
The Upside: Mortgage Rates
Although the current state of the housing market has its downsides when it comes to house hunting, there is still a side of it that can play in your favor: mortgages.
Despite the rising demand and the low supply, mortgages have only been improving for real estate investors and home buyers.
According to the Associate Press, the mortgage rate for the 30-year mortgage in the US is at its lowest point since the beginning of the year, reaching a rate of 3.86% during the final week of August 2017.
Related: How Does the US Housing Market Forecast Look for the Second Half of 2017?
This decrease in mortgage rates, coupled with the number of institutes and organizations that are offering very attractive and affordable entry-level mortgages, makes house hunting easier when it comes to finances. New real estate property buyers will have a higher chance to enter the market and start competing with others.
This, however, also means (and could be the reason behind) that the demand for real estate properties will only grow larger. On the other hand, it could mean that home builders could have sufficient funding to help the market catch up with the demand for new properties.
With all of this in mind, some of the difficulties that make house hunting seem like a time- and effort-consuming process are more related to actually finding the house that you’re looking for.
Apps and Maps
If you’re not interested in driving around cities and neighborhoods and visiting the properties to check them out, give these apps a look, as they can help you do your house hunting through your phone or your laptop’s screen with ease:
- Zillow
Zillow, as a house hunting tool, can be used to find the perfect property from its database of over 100 million homes. Using the Zillow app, you can acquire information and statistics on real estate properties that are available in a snapshot version, in addition to an interactive map that indicates home value estimates, also called Zestimates. You can also use Zillow’s features such as viewing houses from a bird’s eye view, giving further details on individual houses, and even view listings based on your search criteria in a specific neighborhood. There are even more features to Zillow than the ones mentioned here, so make sure to give it a look.
- Doorsteps Swipe
Doorsteps Swipe is a house hunting tool that is very similar to Tinder, but for homes. Additionally, Doorsteps Swipe gives you the option of creating a personal profile which will then try to match you with real estate properties that correspond to your preferences. This includes customization features such as setting your financial situation, marital state, or the number of children that you have, and it will match you with the best candidates for your preferences.
- Other Apps
Other than the two mentioned above, there are a number of other apps that can prove to be a great deal of help when it comes to house hunting. These apps include:
- Homesnap
- Trulia
- Redfin
- Airbnb
- Mashvisor
Related: How the Property Filters at Mashvisor Make Your Property Search Easier
Wrap Up
House hunting can be a very fun activity to do, whether alone, with your significant other, or even with your real estate investment partner. There are, however, some challenges that need to be overcome, and not everyone sees the attraction of having to physically travel around to take a look at the properties that he/she is interested in. The purpose of this blog was to give you some tips and hints of what to expect when house hunting, in addition to the different tools that you can use at your disposal in order to make the task of house hunting easier and less daunting than ever before.
Visit our website at Mashvisor where we post new blogs every day, covering all the different aspects of real estate and real estate investing. In addition, we offer to you effective tools to use on your next investment, such as an investment property calculator for investment property analysis, in order to help you make the most optimal investment decisions and choose the best investment strategies.