A little something I published on the Huffington Post today.
This one is a total 180 from the tone of what I have written in the past. Having lived through a runup of prices, a horrible downturn and the subsequent runup we are currently experiencing, I lean to the conservative side of real estate. They were very dark days I experienced, working for a builder when the phones just stopped ringing. I’m always scared that we’ll end up there again.
In my last article, I said it was a bloodbath out there. It truly is. The market has reached a level of such insanity that buyers have to get creative to get their house. Don’t get me wrong, even I’m perturbed by what is happening now with prices going through the roof and the escalations necessary to secure a home. But I’m not the one looking for a house. You are. And my job is to help you buy your house. So, it’s time for some tough love.
People, we need to get focused!
Here’s the advice I have for buyers in making sense of their Spring, 2017 search:
1) Pick One: Location or Condition
Unless you want to totally blow your budget, you probably have to choose between location and property condition. Real Estate is still about location. It is less about finding the perfect house as it is in finding the perfect location, because locations don’t change. While many sellers and their listing agents have cranked up their game and list a home for sale only when it’s immaculate, other sellers don’t have to try as hard. Some locations are so prime that those sellers can list a house that results in a collective sigh upon crossing the threshold. It needs help, work, TLC, handyman’s special - whatever you want to call it.
Look beyond the inside of the house and focus on the things that won’t change like location. Not considering a house because it doesn’t have the countertop you want is silly. Picking apart the interior features is a waste of time. If you want this location, I can guarantee someone else does. There are a lot of people who will live with linoleum counters to get into the right neighborhood, right school district, etc. You need to stop with the First World Problems.
2) Don’t Fixate on Price
Just ignore the price. There will be the rare occasion that a home is priced slightly low. Don’t fall into the trap of thinking that you can get the house for that price. Other buyers are just as sharp and the house will end up in an escalation situation. Wipe the list price from your mind and offer what you think the house is worth – to you – based on what you have seen already and how much this house checks the boxes for you. I constantly witness buyers trying to talk themselves into higher priced houses that aren’t a fit. Then they find the perfect house that’s priced $50,000 lower and knowing they have to escalate to get the house, they won’t go up more than a tiny bit. But they would have paid more for something they like less? I don’t get that at all.
3) Do You Want a House or a Hobby?
For some I believe it is fun to look at houses. If the market is too tough for you to contend with and you aren’t ready to play ball with the big kids, then it’s fine. Sit this out. There is no reason to keep making yourself (and me) crazy looking at houses every weekend when you have been outbid 5 times and you’re getting frustrated. It’s time to think critically. Is this the time for you to be in the market? You’re fighting against lots of all-cash buyers and fully approved buyers. You have to be aggressive. And for the love of all that is holy to you, please don’t look at 50 houses, write offers on 10 and then claim you aren’t in a hurry. That’s a waste of everyone’s time.
4) Please Don’t Talk About Tennessee.
Or any other place where you are from. And please don’t fly your parents in from another place to do it either. Other markets do not work at all like DC. Don’t apply logic from where you live to this market. This market defies logic. Are we Silicon Valley? No, thank goodness. But the government provides a stable employment base so we’re not like other cities at all.
5) Think of the Money!
Please don’t ignore your lender until you need them. Just go get yourself approved so you have nothing to worry about when the loan process begins.
This DC Real Estate Market isn’t for everyone. Many buyers don’t have the stomach for it. But the ones who do are under contract and locked in at an interest rate that is probably as low as it will be for the next few years.
Your real estate agent’s job is to get you a house, not hold your hand while you pick apart the half-assed renovation of some HGTV junkie wannabe who overpriced the piece of real estate in which you are standing.