The real estate market in Sierra Vista is great for first-time homebuyers. There are many reasons for this, including the number of homes for sale and the price point. Right now, buyers can purchase a home with a mortgage that is less than what they would pay in rent!
Having a large number of homes for sale and an average ‘days on market’ of about six months means we are considered a “Buyer’s Market.” Buyers can use this to their advantage and ask for seller concessions, such as a longer escrow period (a.k.a. time under contract) or seller-paid buyer’s closing costs. Closing costs can run about 3% of purchase price.
The best part about all of this is that our housing prices and interest rates are still historically low. Consumer-savvy buyers are getting good deals right now. How do first-time homebuyers get good deals? Here are my top five tips for first-time buyers in our market.
Get prequalified upfront before looking for homes
The majority of first-time homebuyers rely on financing to purchase a home. It is the very best idea to consult with a lender before starting your home search. This way you won’t have any surprises. A lender will review your financial data provided, to include tax returns, pay stubs, and credit score, to see what interest rate and mortgage amount you qualify for.
A lender will also help you decide what type of loan program you plan to use. Examples include government loans, such as FHA, USDA, and VA; and then conventional loans. Each loan has its own set of property requirements and your Realtor needs to know this prior to locating housing options.
A lender consultation in the very beginning saves everyone time because once you see the home of your dreams you will be ready to present a prequalification letter with your offer.
Pick a good buyer’s agent who knows the market well
Now that you have your prequalification letter it is time to find a Realtor who will be your “Buyer’s Representative.” Your Realtor can show you any home in the area, and not just ones listed by their brokerage.
Do not underestimate the benefit of having a strong Realtor by your side. It’s important to research an agent before you choose one. Look for their number of recent sales, years on the job, NAR (National Association of Realtors) designation courses taken, and online reviews.
The majority of buyers use Realtors that were recommended by family and friends. If you are new to town and do not have a friend recommendation you can rely on online sites to do agent research.
Write down your top wants and needs
Start with a pen and paper, and jot down all of the things you want in a home, such as number of bedrooms, number of bathrooms, square footage total, bathtub in the master bathroom, fenced yard for Fido, garage or carport, etc.
Once you have a decent list, decide which of those wants are absolute needs. Do you have a large family and need the extra square footage? Come up with 3-5 top needs and wants. This will save you lots of time once you start previewing homes. You will be able to weed out homes immediately.
Research areas of town
Now that you know what you are looking for in a home, do some research on neighborhoods and areas of town. Is it important to be close to a grocery store and other shops?
Word of mouth is a good way to research neighborhoods, online review boards may help if you are out of state. If you are local, the very best method is to drive around to discover the best neighborhood for you. Your Buyer’s Representative can be an invaluable resource for this as well.
Definitely do formal inspections once under contract
It is hard to pick only five tips for first-time homebuyers. This last one I definitely wanted to include because many buyers may think they do not need to do formal inspections due to the time and cost. Think of it this way, a $400 inspection could save you a $150,000 mistake. See my point?
Hire a competent and well-reputed home inspector to conduct a formal home inspection. This 30+ page report will include information on the type of heating and cooling, the approximate age and wear of the roof, electrical systems, plumbing systems and fixtures, and of course any latent (or hidden) defects discovered.
A home inspector may suggest a professional heating and cooling technician, or a roofer come out for further evaluation. Your Realtor will coordinate these inspections, and present to you all of the data discovered so that you can make an informed decision on which repairs to ask the seller to repair, or a credit to be given in lieu of repairs.
About the Author
Katherine Mullen is a licensed Realtor with over 3 years of active sales experience in Cochise County and a member of Southeast Arizona Association of Realtors. A Tierra Antigua Realty agent, Mullen also has a master’s in business administration and is an avid researcher of all things real estate. Visit Katherine-Mullen.com for more and to search the MLS.