How to go from renter to owner on Long Beach Island?Located on the North End in Harvey Cedars, this three - bedroom, two bath duplex shares ownership with other members of a homeowner
Opportunities in the Real Estate Market
Whether you follow the news or not, you know that the Real Estate Market has really taken a hit in the last few years. We have all heard about prices being down and how hard it is to sell a home in today’s market. However, what you haven’t been hearing is that there is a lot of opportunity in today’s Real Estate Market. Because prices have come down and mortgage interest rates remain at all time lows, around 4%, the opportunity to enter the housing market, or to sell your long time residence is actually there, if buyers and sellers are realistic.
Knowing these facts, buyers over the last few years have either been waiting for the prices to go lower, or have put in very low bids on houses hoping to get a great deal. What many do not realize is that most homes on the market have already been reduced, drastically in some cases, and a home that sold for $350,000 4 or 5 years ago can now be purchased in the mid to high $200,000’s. Also, if you think back to that time, mortgage interest rates were in the 4.75-5% range. So purchasing this home now, Buyers are getting a 20-30% discount on the price and a mortgage that may be as much as 1% less. Of course, no one can accurately predict what prices or mortgage rates are going to do in the near future, although many industry professionals try, these numbers should look very attractive to prospective home buyers. One thing that Buyer’s should not fall into the trap of is offering so low of a price that the seller will not even be willing to negotiate with them. Sellers have all ready taken a very big hit and if a buyer comes in with an offer of 20% or more less that the asking price, they run this risk. The important thing is to work with a professional who knows the market well and can advise Buyer’s what price a house should sell for and where they should start the bidding process.
What many people also don’t realize is that if you are looking at selling your home, and have owned for 7-10 yrs or more, there is a pretty good chance that you still have equity in that home. Sure, it’s not as much as it was 5 years ago, but it is most likely enough to either trade-up or scale-down from your current home. For example, if you bought a home in 2001 for $200,000, at the height of the market in 2005-2006, its value most likely went up to around $400,000. Since then, it has scaled back to around $280,000-$300,000, which still leaves you with $80,000-$100,000 equity in your home. The key for sellers is not set your original asking price too high. If you start with a price that is too high, you will most likely not get many showings and the house may sit on the market for a year or more. You will also run the risk of selling your home at an even lower price than you would have gotten if you priced it right to begin with. Even in this market, we have seen homes that are priced correctly sell very fast, and some have even gone to bidding wars, something we haven’t seen since the height of the market. Again, it is important to work with an agent who knows the market, and can give you a realistic price on what your home is worth.
So, if you are a first time buyer, or a homeowner who has owned your house for more than 7 years, there are lots of opportunities in the current Real Estate market. The important thing is that whether you are looking to buy or sell, you work with a professional agent who knows the market well, and can advise you properly.