Ted Siefer reports yesterday in the Boston Globe (When home choices are few, patience is a virtue) that inventory of homes and condos for sale statewide are down 22% since June 2006. This means fewer options exist for potential buyers:
It may be a buyer's market out there, but some home shoppers aren't feeling too empowered by what they're seeing for sale these days.
The good ones that do come up for sale get snapped up right away. And a property that languishes can make buyers suspicious there's something wrong with it, or that the sellers are being unrealistic about the price.
A recent client of ours at Charlesgate Realty Group, Alan Nawoj, who just found a new home after 2 years of looking, was quoted in the article:
At one point Alan Nawoj was more discouraged by his search for a condo in the Boston area. "Supply was so low that I basically had to wait for the next listing to come in," said Nawoj, a technology consultant. "Two years ago when I started looking, it was a different ballgame."
But Nawoj persevered. Last month he closed on a condo in Cambridge, for around $10,000 less than it was listed for when it was on the market two years ago.
The lesson Nawoj takes away from his protracted search is to be patient, but also prepared to pounce when the right opportunity comes along.
"It made me aware of how quickly you have to react," he said, recalling several occasions when places were scooped up before he even had a chance to make a bid. "I made an offer two days after this place went on the market."
As a buyer in the Boston area (especially in the desirable neighborhoods with low inventory like the Back Bay, Beacon Hill, and the South End), the key is to be patient - but be well prepared and ready to seize an opportunity as it comes up. Good condos do come on the market, but buyers swarm quickly so you must have a competitive advantage. Three quick tips on how:
- Have financing completely lined up before you start searching, or at least as completely lined up as it can be, by getting all necessary documentation to the lender, getting a full preapproval, and knowing what kind of loan you will be taking. Also - don't forget to keep an eyes on the current mortgage rates as your search continues. A change can greatly affect your monthly payments (for good or for bad).
- Hire a good (no, great) buyer agent who KNOWS the neighborhoods where you are shopping and can alert you if a property will be really "hot" (sometimes intangibles make a property desiresable to attract buyer attention quickly and an experienced buyer agent can spot that first).
- Take your search seriously. This sounds stupid, after all, how does someone not take buying a home seriously? You'd be surprised. We are talking about the biggest investment in many people's lives, yet some are unwilling to leave work a few hours early to go view properties, for instance. Or are unwilling to review the listings online on a regular basis. When you can only look at properties one or two weekends a month, you are bound to miss out on some of the more desirable properties. I suggest you really plan your search - try to give it the time it deserves. If that means waiting for a less busy time at work, or until other circumstances allow you more time, then so be it. But rushing into it and not taking your search seriously can compromise the end result.
Don't get me wrong - there is also a lot of crap on the market, and not every property is "hot", and not every market has low inventory - it's all local. There is a big difference between a great property and a weak property and a tight market and a slow market. But Alan knew that. He was a patient and educated client, took our advice and guidance seriously, and was able to act quickly when he needed to to get himself a great deal when the time was right.