We Asked a Real Estate Agent How to Navigate a Hot Market as a First-Time Home Buyer
This unpopular listing detail is a secret opportunity.
Published Aug 4, 2022 1:45 PM
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Cassidy Iwersen always fantasized about becoming a real-estate agent. “I just felt like maybe New York wasn’t the place to start that kind of career,” she says. So when the longtime art director and interior stylist moved to the Dallas-Fort Worth area in 2019 (one of the top destinations for people relocating during the pandemic), she decided to take the leap, get her license, and join Compass as a sales agent. “I was gaga over what you could get for $500,000,” she recalls. After living in New York and San Francisco prior to that, this was a good kind of sticker shock.
While Iwersen works plenty with sellers, listing and staging their spaces, she’s got a soft spot for first-time buyers trying to navigate a hot market. “I feel like their big sister,” she says. “I want to help them, because it’s scary and overwhelming and there’s a lot [to do] in a short amount of time.” Her experience working in a very visual, creative industry for so long comes in handy when she needs to help nervous buyers see the potential. “Pairing this with my real-estate knowledge, we’re able to make decisions that will save or make them money,” explains Iwersen. Whether you’re navigating booming Denver or thinking of putting down roots in bustling Salt Lake City, we asked Iwersen for her tips for getting through it all stress-free.
Consider Living With—Wait for It—A House with One Bathroom
We know what you’re thinking: deal breaker. But let Iwersen help you see the potential. “A lot of older homes still have just one bathroom, which can deter a lot of buyers,” she notes. “But if you can live with that for a minute while you add a second, you’ve instantly increased the value and marketability next time around.” Still, the thing to ask yourself before you commit to a total fixer-upper is, will the other houses in my neighborhood keep (or appreciate in) value over time? “It doesn’t matter how much you put into a house if the houses next to it aren’t as nice or worth as much,” Iwersen points out.
Speed Up Your Timeline From the Get-Go
Start watching the market and getting to know the different neighborhoods so you can see what is available in your price range and how long things are coming and going, that way you’ll be able to spot a good deal when you see it. “It will help you move quickly when you’re ready to put in an offer,” says Iwersen. In superhot markets, there isn’t a lot of time to research or ask around about the neighborhood, school district, or commute times after you’ve seen a listing.
Get Friendly With a Trusted Lender
In many of these booming markets where houses are selling in 20-something days, it’s often required that you send in a prequalification letter (a document that signifies a lender has reviewed your financial information and confirms you’ll qualify for a loan) with your offer. “It’s not the time to start thinking about your mortgage. Sellers want to see that you are ready to go and have everything queued up and in order,” says Iwersen. Meeting with a local lender early on will help you determine your purchasing power, clean up any credit issues you might not be aware of, work out your monthly mortgage payments, and get an idea of how the process will work.
Look at Listings That Have Been Around for at Least a Week
Great move-in ready listings go fast, so you’ll need to use your imagination and be open to homes that might need some paint or fresh lighting. “If you can look past wallpaper or dated decor, you can possibly avoid a multiple-offer situation and even have some negotiation power,” says Iwersen. “I’m finally hearing about sellers giving concessions or credit to buyers to help buy down their mortgage rate on properties that are sitting a while on the market.”
Seek Out Timeless Architectural Details
Details that make a house worth buying come down to quality of materials: hardwood floors, walls with trim or molding, brick or plaster walls. “Like a well-made pair of jeans or a leather jacket, these elements stand the test of time while gaining character and charm,” says the pro.
Win a Bid by Making the Seller’s Life Simpler
Your purchase price isn’t the only thing that can stand out in a bidding war. Waiving contingencies and appraisal, having the shortest option period possible, and offering to pay for the seller’s title insurance (or survey or closing costs) will put you ahead of the group. “Sometimes it’s not just ‘highest and best,’” says Iwersen. “Perhaps the seller needs a lease back (time in the home after closing while they look for their next home or extra time to pack or finish out the school term), and if you can extend that to them, it could really be beneficial.”
Offer Cash Through a Third Party
There are a number of newer programs that have grown this year in response to the increase in cash-only offers. Companies such as Ribbon and UpEquity can work with your mortgage lender (or act as one) and present your offer as cash. “They actually purchase the house for you and then you get a certain amount of time to secure financing and buy it back from them,” she says, noting that they will charge you a percentage of the purchase price to do so, but it might just be worth it.
Part of feeling ownership is putting your stamp on your space. Luckily, if you’ve spent most of your savings on a down payment, less is truly more. “By adding in a few intentional updates, it diverts attention away from a countertop or backsplash that might not have been your first choice,” she says. Here are some simple changes Iwersen often recommends:
In the kitchen
- Paint or stain the existing cabinets
- Change out the ceiling fans or light fixtures
- Add a fresh sink and faucet
- Lay down rugs
- Shop for new appliances
- Swap out the cabinet hardware
- Hang up window treatments
In the bathroom
- Switch out the vanity (some start at just a few hundred dollars!)
- Hang a statement mirror over the sink
- Wallpaper above dated tile
- Go with matte white or black plumbing fixtures
And when in doubt, paint the walls white. “And the ceiling!” says Iwersen.