Although many people associate
spring and summer with real estate shopping, the fall season can be just as
bountiful in terms of advantageous home purchase deals.
According to the National
Association of Realtors (NAR), home sales for pre-existing homes have risen
more than 10% from last year’s measurements. In the meantime, the number of
backlogged homes on the market has diminished by 31% from a nine-month plus
supply of 3.15 million in July 2011 to a 6.4-month stock of 2.4 million during
the 2012 summer. Consequently, the portion of foreclosed and near-foreclosure
properties on the market has plummeted to 29% this July from last year’s 24%.
According to NAR chief economist
Lawrence Yun, the combination of historically low interest rates
during 2012 and rising rent prices have allowed for the release of what had
been a stifled demand.
As interest rates continue to
drop, reaching 3.55% recently in contrast to last July’s rates of 4.55%, buyers
who have cautiously waited following the economic decline and devastating
housing crisis may begin to relax their guard and start making purchases.
However, with approximately 18% of U.S. homeowners underwater on their
mortgages, including a majority for homeowners between the ages of 30 and 34,
buyers should not act too rashly.
Accordingly, here is a list of
tips for homebuyers navigating the real estate market this autumn season:
1.
Shop
for bargains.
According to the recordings of
the National Association of Realtors, home prices generally drop by an average
of $7,000 following Labor Day. Although homes located in the West or Southern
United States may only level off or even slightly increase during the colder
months of the year, Midwest home prices decline on average $10,000 between the
months of August and September. In addition, prices for homes located in the
Northeast decline nearly $20,000 on average by October.
2.
Understand
the market.
In terms of fall pricing
discounts, borrowers should understand the limitations of this price advantage.
Essentially, these price adjustments will not be available in permanently warm
climates such as Florida and Southern California. Additionally, homebuyers
searching for property in ski-resort towns and popular destinations may be
disappointed. As such, fall homeowners should consider whether or not their
ideal home is situated in a region where a price drop is likely to occur; for
best results, search for homes located in snowy areas, where homeowners might
be willing to sell more quickly to avoid remaining in the home for the winter.
3.
Watch
for desperation deals.
With summer winding down, buyers
should be on the lookout for homeowners who were unable to sell their home
during summer. Note if the advertised photo of a home has remained the same or
if the price of the home has significantly dropped without any contractual
updates; either of these may be signs of a desperate seller and this will work
in your favor. With such a profitable summer for the real estate industry and
mortgage rates still exceptionally low, buyers should keep an eye out for
negotiable deals with sellers of homes that did not sell for one reason or
another.
4.
Keep
your eyes open.
While fall may be a pleasant time
of year to watch the beauteous transformation of nature in magnificent color,
it also marks a dramatic change in weather. When looking to purchase a home,
borrowers should keep their eyes open for signs of homeowner neglect,
conveniently aided by the season; with the abundance of leaf litter and the
return of rainfall, homeowners should be able to see what aspects of the home
have been neglected. One tell-tale sign that buyers should be aware of is the
accumulation of leaves in the gutter in September or early October, which
should be a red-flag for potential homebuyers.
5.
Utilize
seasonal discounts
According to data provided by the
U.S. Census Bureau, fall, and especially September, can be a slow month for
contractors and home improvement stores such as Home Depot and Lowes. If you
are considering a remodeling project, for instance a kitchen upgrade or a
bathroom retiling, home stores and builders generally discount their stock
during the autumn months, making these projects more affordable. Furthermore,
this discount may be acquired in the process of building a new home, compounding
the savings and making this the best time of year for home building projects.
6.
Compare
lenders.
As with any time of the year,
comparing lenders and mortgage rates during the fall season will help you to
save thousands of dollars over the course of your home loan. With patience and
persistence, borrowers can secure tremendously advantageous interest rates and
loan terms.
If you are searching for a home
loan lender, visit our Lender411 Find a Lender page in order
to conveniently locate all nearby lenders in your vicinity. Give it a try and
start comparing lender offers today!
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