The hot real estate market offers opportunities for sellers, pitfalls for buyers
(WXYZ) – The real estate market remains hot, with industry leaders saying finding a home has never been harder.
If you’re trying to buy a home, be prepared. Inventory is low and the number of people looking to buy a home remains high, especially as the spring and summer months approach.
And now, a growing trend in the housing market is creating more frenzy.
Nakia Washington has lived all over the world, but when she thought about buying her first home, she knew,
“Must be in Detroit,” she said. So, in October 2021, she began her search.
“It was interesting,” she laughs.
Interesting and sometimes heartbreaking. Washington says she found a house and went all-in, bidding $20,000 over the ask, but then disappointed.
“We weren’t even like second or third,” she said. “It wasn’t even like we were going to consider you.”
“You’re really like, sort of…in an auction house throwing your paddle in the air,” says Janet Graham.
Graham, associate broker at Howard and Hanna, has been a real estate agent for 25 years. She says this market is unprecedented and buyers need to know that you don’t make an offer, you make an offer.
“You have to come and visit a house with your checkbook in hand,” she says.
And there is a growing trend, some say, of pushing people to dip deeper into their pockets. Advertise a home with a best and highest bid deadline. For example, we found a house that had only been online for two days and wanted to receive all offers by the end of the week.
“The first time I saw this, I said to my wife, ‘I think this is ridiculous, I don’t want to deal with them,'” said John Fendo, a home buyer.
Frendo, who goes through the process of buying a home, calls the tactic a trick, used to get buyers to get emotional and outbid.
“That’s what salespeople want people to do,” he says. “It’s a way to create a real demand environment for the home.”
David Hall, CEO of mortgage brokerage Hall Financial, says it’s a seller’s market, and will continue for the foreseeable future, but his advice to buyers? Stay patient and smart.
“You have to be disciplined in how you buy so you don’t get stuck in a situation where if you pay way too much the market corrects itself,” he says.
But when will the market correct? With inventory still low, this could take a while. But Hall predicts that as interest rates rise, more sellers may enter the market and buyers will have more options.
“I’m just cautiously optimistic,” he says.
Another tip from real estate agents: if you’re looking to buy a house, try to get into a house before it goes on sale to avoid a bidding war. This means asking people in the neighborhood you want to live in if they know of anyone who is looking to sell their home and is proactive.