DETROIT – It can be difficult to buy a home under $300,000 these days. Real estate agents claim offers come flooding in within hours of a new listing.
While sellers are reaping the rewards, buyers are having a hard time to get their foot in the door.
For those house hunting, they already know the struggle. Michigan has the 14th fewest homes for sale in the country. As a result of this shortage, supply and demand is at play -- the low supply is shooting prices into the nosebleed section.
Dan Elsea, with Real Estate One, said it’s the best time to sell a home in Michigan in nearly 40 years.
Those who have a for sale sign in your yard, it’s not likely to stay there long. Elsea said if your home is under $250,000, you have a 70% chance of a bidding war. If your home is over $250,000, there’s a 40% chance of a bidding war.
You don’t have to put a lot of money into your home to get a sale.
“We’re selling a lot of houses that normally would have been either discounted -- because they are fixer uppers -- or maybe sat on the market for a long time because they needed work,” Elsea said.
In order to have a sale, you need a buyer and in this white hot market there’s a definite strategy -- be ready to make more than one offer on more than one home, have professional help and bring as much cash as you can get together.
“Make sure you’ve gotten yourself completely underwritten for your mortgage,” Elsea said. “Not just am approval letter that says ‘I’m good for X.’ A lender has completely underwritten your mortgage, so you are just waiting for an address basically.”
Elsea also has advice for first time home buyers.
“Go after those homes that might be on the market for a while that have more work than most buyers are willing to put into it,” Elsea said. “There are some hidden gems out there but you’ve got to expand your view of what you’d like to buy.”
Another thing to consider is to offer free occupancy for the seller for a longer period of time and if the appraisal falls short, offer to pay the difference. Elsea said this is the best way to rise to the top of a list of prospective buyers.
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