We all know what the term buyer's market means and those of us trying to sell a home are groaning inwardly. It is possible to miss the market by only a few months or so, and be thousands of dollars out of pocket! Or sometimes we are just theoretically thousands of dollars out of pocket, and we have only lost perceived profit.
One real estate broker who believes that this is a buyer's market is giving advice to his clients that they should not be afraid of putting in a low offer. He suggests the maximum would be an offer as much as 15% under the asking price. This represents a large saving to the buyer (and a large loss to the seller).
For instance on a house of $300,000. he is suggesting that you could come in with an offer of $255,000. Likewise a house of 200,000 could be bid in at $170.000
Further advice from Gary Eldred, who is the author of "106 Common Mistakes Home Buyers Make (And How to Avoid Them)" advises that the longer a house has been on the market, the more powerful your position is as a bidder. Because this is a well known fact in the industry, a seller may sometimes organize the way that the dates are recorded in the MLS listings.
They are not exactly incorrect, but the house can have been taken off the market, and then put on again, therefore making it look like a new listing. This can often be deceiving, but you can clarify this by asking for your realtor help in accessing the home's full listing history. This will tell you the total time the house has spent on the market, and any price changes that have been adjusted.
One of the problems of a buyer's market, in terms of being a seller, is that you could list your house for sale and not sell it! This is even worse if you have put in an offer on another house. Two mortgages is tremendous stress on an income.
One way around this is to sign a 'contract for sale' to buy your next house with a contingency clause written into it. The clause states that you are not liable to complete on your new house purchase if you do not sell your existing home You may lose your down payment, so try and keep it small.
He also advises that a prospective buyer now can do things that he did not dare to do last year, like asking the builder of a new house to include free upgrades. Another suggestion is to ask the existing owner of a property to make repairs to be completed before you move in. It may make the property owners bristle, but sellers would be advised by their realtors to think seriously before rejecting a negotiating point from a prospective buyer - that is what a buyer's market is all about!
