If you are thinking about buying a home today, there is good news. The market is still favoring sellers, but it is not as bad as it was last year. You do not have to waive any of your contingencies or offer more than the asking price to have your offer considered. It’s still a seller’s market, but buyers are gaining some traction.
Today, you have an advantage when buying a home. This is because there are not as many people competing for homes as there were before. This also gives you more power to negotiate the price of the home. So if you were waiting for things to cool down, now may be the time to enter the market.
The Return of Contingencies
In the last two years, more buyers were willing to skip important steps in the home buying process, like the appraisal or inspection, to try to win a bidding war. But now, fewer people are waiving those steps.
The National Association of Realtors (NAR) has released data that shows the percentage of buyers who waive their home inspection and appraisal is declining. A recent survey from realtor.com confirms that more sellers are accepting offers that include these conditions today. According to their August study:
- 95% of sellers reported buyers requested a home inspection
- 67% of sellers negotiated with buyers on repairs as a result of the inspection findings
This shows that buyers are more likely to include these conditions in their offers today and negotiate as needed based on the outcome of the inspection.
Sellers Are More Willing To Help with Closing Costs
In general, closing costs range from 2% to 5% of the purchase price for a home. Before the pandemic, it was common for sellers to offer to pay some of the buyer’s closing costs in order to make the deal more appealing. This didn’t happen as much during the past two years when there was a lot of buyer frenzy.
As the market changes and demand slows, some sellers are paying some or all of their buyer’s closing costs. This is a way to negotiate with the buyers. Keep in mind that there are limits on how much a seller can contribute to closing costs. These limits vary depending on your state and the type of loan you have. Talk to your loan advisor to understand how much a seller can contribute in your area.
Sandi & Debbie Say…
Despite the extremely competitive housing market of the past several years, data suggest that negotiations are starting to become more common again. This is good news for people who are planning to enter the housing market. If you want to find out how the market is shifting in your area, let’s connect! Call us at 949-293-5139!
*Info and data from Keeping Current Matters ©2022.
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