Still haven’t decided whether you should buy right now? Still think it’s a “bad” market? Here are ten reasons, originally presented by Paul Pastore, why YOU, as a buyer, benefit from this market.
1. Selection, selection, selection. With over 57,000 homes on the market in the greater Phoenix area right now, you have choices that buyers just a few years ago would have loved. In fact, just a few years ago, the resale home inventory dropped below 5,000. Today, you have TEN TIMES more options!
2. No bidding wars. In 2005, we once received 17 OFFERS on a single listing! That means that 16 buyers’ offers were rejected and those buyers had to move on and settle for their second favorite home. Some of our buyers in 2005 had to move on and settle for their third and fourth favorite home. But hey, 17 offers was good news for our sellers, right? Actually not really. With that many offers on the table, how does one choose? Buyers were including with their offers hand-written letters about themselves, their family, their pets, why they need the house for their sick grandparents, etc.. Today, there is much less competitive bidding for a single home.
3. You can make an offer. In this market, the average home is selling for 96-97% of list price. Sellers realize that they are probably not going to sell their house for full list price. So go on, make those sellers an offer they can’t refuse!
4. Patience is tolerated. In hot sellers’ markets, everything tends to get rushed: the house hunting, the offer-writing, the negotiating, everything. Now, a buyer can take his/her time looking through the Multiple Listing Service, and visiting several homes, before making an offer.
5. Due diligence is welcomed. Because most buyers in this market are not having to compete against other buyers for the same home, buyers are not having to waive their right to inspections in order to make their offer more attractive. Today, it is expected that a buyer will order at least a general home inspection and a termite inspection.
6. There are plenty of specs. Having plenty of spec homes available means that you are most likely not going to have to enter a lottery in order to make an offer on a new build, or sleep in your car overnight in order to get to the front a builder’s waiting line. R.L. Brown, a well-known housing economist and analyst, estimates that builders have thousands of specs ready right now for immediate occupancy.
7. Repair requests are welcomed. After you have received your home inspection reports, you are allowed to submit a repair request, which asks the seller to repair certain conditions or allow you to back out of the contract if the seller will not make the repairs. Isn’t it great that, in this market, you don’t have to buy a home “as-is” in fear of another buyer waiting behind you who is willing to do so?!
8. Few, if any investors. It has been estimated that, in 2005, 33% of all home sales were made to investors. These non-occupant buyers were part of the cause of the inflated home prices in 2005. They also stimulated the mortgage fraud problem we are recovering from. Today, buyers can enjoy more affordable homes, because of the fewer number of investors active in the market.
9. Location, location, location. In 2005, most buyers looking for affordable housing knew to look in Maricopa and Queen Creek. Now, there are well-priced homes throughout the Valley, just minutes away from downtown Phoenix, schools, and/or public transportation lines.
10. Real financing is available. Fixed rates are back! First-time homeowner bond programs are back! And so are special loan programs for teachers, doctors, nurses, and police officers! It is, in fact, a great time to buy real estate!