When is the best time to buy a home?
This question is difficult to answer. The spring market in the Twin Cities has a higher amount of activity and competition, which may yield multiple offers on more of the houses. As of this year (2018), you can expect every house to be in multiple offers within the first 2 days of it being on the market. So buying in this strong sellers market is more challenging.
On the flip side, there is more inventory to look at. You'll have more homes to choose from and that can make it easier to find the perfect match. Our fall and winter markets are usually pretty slow. February and March are the typical start of the home buying season with an increasing number of homes being put on the market.
What is a short sale, foreclosure, or bank-owned home?
A short sale is when a seller cannot sell their home for enough money to pay off their mortgage. They are "short" of funds to sell it outright. This involves the seller's mortgage company as part of the approval process, often adding 4+ weeks to the process.
A foreclosed home or bank-owned home is when a bank takes a home back from a person that did not make their monthly mortgage payments. The bank foreclosed on the home, and is now trying to sell it outright.
How is the neighborhood? Schools? Crime?
These are common questions that real estate professional cannot answer. There are rules against steering and this type of data could be seen as steering. We can give you tips on evaluating neighborhoods, or schools, or even crime data. But it is really up to each buyer to figure out what is right for them.
City-Data.com - One of the best sites for neighborhood information
Great Schools.org - Site that shows school rankings
Community Crime Map - Crime data, or contact the local police department
What's the first step of the home buying process?
The first step is getting pre-approved with a mortgage lender. This is a very important step and lets you know how much home you can afford. By knowing your price range, you can narrow down which homes you see and not waste time on houses that won't work for your budget.
The loan estimate will also let you know how much down payment you will need, and how much closing costs will be. This may show that you need to have more time to save up for the down payment or it may show that you need to ask a seller to pay for your closing costs.
How many homes on average, do buyers look at before buying a home?
15-25 depending on the market. In a strong seller's market, it may be toward the lower end because there are less homes to look at, or they sell quickly before you can get in.
What is earnest money for?
Earnest money is to demonstrate to the seller that you are a real buyer. If we didn't have earnest money, then everybody and their uncle could make an offer on every house just to see if they can get a good deal. But having to put down earnest money stops everyone from making useless offers.
Should I get a home inspection?
Yes! The home inspection is a critical part of the process of buying a home. The bottom line is that it helps you know what you are purchasing, and what condition the home is in. Then you can evaluate if that matches the price you are paying for the home.
I currently own a home. Should I sell first before I buy?
Buying first can be daunting without knowing whether your house will sell. But the option of buying a house non-contingent is paramount in this sellers market. If you try to make an offer subject to the sale of your house, there will probably be other offers that won't have that contingency, meaning you won't get the house.
On the other side, if you sell your home first, then start looking for a new home, you could be out of a home. It takes several tries to purchase a home due to the competitive nature of the sellers market right now (2018).
How long does it take to buy a home?
A typical timeline for the home buying process is 6-8 weeks once the purchase agreement is written.