Buying in a Tight Market

When the market tightens up you need to take precautions to make sure you get your dream home under contract without worrying about competition from another buyer who may be interested in the same property. Follow these suggestions to increase your chances of a successful closing.

1. Get pre-qualified, not simply pre-approved for a mortgage. Sellers are sometimes looking for the best terms for a contract and a pre-qualified buyer is attractive. Price is not always the only issue.

2. Take the time to do some research on your own time. The internet is a great place to start with many good website's to aid in your search in addition to the traditional newspaper ads and Open Houses. Drive around some of your favorite neighborhoods and you may find that dream home with a For Sale sign in the front yard.

3. Communicate with your Realtor®. Your agent will know when a home first comes on the market that meets your criteria. Be flexible and be ready to go and view the property as soon as possible.

4. Once you've done your research and have your financing in line then you're prepared to make an offer. When you find your new home you'll be ready to act quickly.

5. In a tight market you have to be careful with your offer. Naturally you want to get the best deal possible, but you don't want to "low ball" the offer so low that it is rejected entirely and you won't have an opportunity to "counter-offer" or negotiate. Remember, other buyers are in the market. Be fair and it should be a win-win for all parties involved.

6. Contingencies. In a tight market contingencies might be a problem especially if you're going up against other buyers for the same property. If you need to sell your home first or need a special closing date, then you may be putting yourself at a disadvantage. A bridge load may be available from your lender to "bridge" the mortgage on your present home and also your new home for a short time until your present home sells. A home equity loan could possibly serve the same purpose.

7. Don't get emotional. That's hard to do when you find your dream home. Even though the market may be tight you need to make wise decisions based on facts and not entirely on the emotional impact of the property. Follow the suggested procedures and don't skip important steps like a home inspection.