{"id":6615,"date":"2021-03-24T11:40:35","date_gmt":"2021-03-24T18:40:35","guid":{"rendered":"https:\/\/www.flyhomes.com\/blog\/?p=6615"},"modified":"2021-05-05T12:36:55","modified_gmt":"2021-05-05T19:36:55","slug":"truths-about-the-current-real-estate-market-and-tips-on-buying-in-a-sellers-market","status":"publish","type":"post","link":"https:\/\/flyhomes.com\/blog\/truths-about-the-current-real-estate-market-and-tips-on-buying-in-a-sellers-market\/","title":{"rendered":"Truths about the current real estate market\u2014and tips on buying in a seller\u2019s market"},"content":{"rendered":"\n

If you\u2019re buying a home right now, you\u2019ve got a lot of company. Maybe you\u2019ve already found yourself in multiple-offer situations. It\u2019s possible you\u2019ve even had trouble booking appointments to see homes you\u2019re interested in because so many other buyers are trying to see them, too. <\/p>\n\n\n\n

We\u2019ve heard agents with decades of experience say they\u2019ve never seen a more competitive market than they\u2019re seeing right now. If that sounds scary, we understand. A market like this creates frustration for buyers. It can even break hearts. We\u2019re here to help!<\/p>\n\n\n\n

There\u2019s no single solution to less-stress homebuying in an ultra-busy market, but there are options. We talked to Flyhomes agents in extra-hot markets\u2014the Bay Area, Southern California, and Seattle\u2014for insight on exactly what\u2019s happening in the market and how to navigate through heavy competition. <\/p>\n\n\n\n

Just how crowded is the real estate market? <\/strong><\/h2>\n\n\n\n

\u201cThis current climate is at or near the top of competitiveness I\u2019ve seen in my career,\u201d says Lanz Camacho, Flyhomes Client Advisor Lead in the Bay Area, who has been an agent in the area for almost two decades. \u201cMany homes are getting twenty to thirty offers.\u201d <\/p>\n\n\n\n

Because competition is essentially guaranteed, many sellers are using the listing strategy<\/strong><\/a> of under pricing homes. This tactic is intended to drive up the home\u2019s sale price\u2014buyers offer as much as they\u2019re willing to pay instead of as much as the home is worth according to comparable sales. <\/p>\n\n\n\n

\u201cYou almost never see a home listed at comp value in northern California,\u201d he says. \u201cAnd value estimates online are oftentimes still lower than we find through our research.\u201d <\/p>\n\n\n\n

Lanz says under pricing by five to ten percent is typical across the Bay Area and as much as ten to twenty percent is unsurprising in the hottest areas. Sometimes, the gap between list price and sale price is even wider. He recently helped a client who loved a home that sold for almost forty percent more than the list price. It was priced at about $1,100,00 and sold for about $1,500,00. <\/p>\n\n\n\n

In an extreme example, one Berkeley home was listed in March for $1,150,000 and is expected to close above $2,000,000, per the listing agent. Even she was astounded at the huge difference \u2014she told Lanz\u2019s teammate, whose client made an offer, that she expected it to sell closer to $1,700,000.    <\/p>\n\n\n\n

The Bay Area isn\u2019t the only place where the under pricing trend is common. Flyhomes Client Advisor Jack Schwabeland sees it in Seattle, too. <\/p>\n\n\n\n

\u201cWe are deeply into a seller\u2019s market right now,\u201d he says. \u201cBuyers have to be prepared to do what it takes to get a home. At the end of the day, it\u2019s going to boil down to whether you like the home enough to pay more than the next person \u2026 and they\u2019re probably willing to pay a lot.\u201d <\/p>\n\n\n\n

Be sure to discuss the gap between what a home is \u201cworth\u201d and the sale price with your agent. There are pitfalls they can help you understand. <\/p>\n\n\n\n

For example, when you buy a home at a price that\u2019s been driven up by competition, you may risk a low appraisal<\/strong><\/a>, which can cause you to pay more at closing than you were planning to cover the gap. There are other ways<\/strong><\/a> <\/strong>to deal with a low appraisal, but in today\u2019s market, it\u2019s smart to talk with your agent about working this potential payment into your budget. <\/p>\n\n\n\n

What\u2019s it like to be in a real estate bidding war? <\/strong><\/h2>\n\n\n\n

While every situation is different, let\u2019s take a look at a recent multiple-offer situation to set the stage for what it\u2019s like to buy a home in the current market. <\/p>\n\n\n\n

Trina Daniels, the Flyhomes Client Advisor Lead in Southern California, has been helping people buy and sell homes for more than 20 years. At the end of February, she listed a single family home in La Mirada for $740,000. She knew competition would be hot, but she wasn\u2019t prepared for what happened: the seller received 45 offers! <\/p>\n\n\n\n

Here\u2019s how it went: <\/p>\n\n\n\n