It can be daunting to shop for a condo in a seller’s market, but this doesn’t mean that buyers need to jump the gun and overbid. Investing when the Downtown San Diego real estate market is hot still requires careful planning, diligent research and a knowledgeable and experienced guide. Following are four mistakes that buyers make in challenging market conditions along with tips for avoiding these common pitfalls.
1. Failing to Have a Comprehensive and Accurate Budget
The sense of urgency that a seller’s market incites can lead to rash decisions. It is important for buyers to carefully calculate the full costs of property ownership and determine how much outside funding they can get early on. A solid budget is the foundation of every good purchasing plan. If the market is hot, you could be asked to increase your offers and expand your budget. When in doubt, consult with your financial planner or tax adviser to avoid getting in over your head.
Bidding wars are common in a seller’s market, and they often lead to people paying quite a bit more than a place is actually worth. Take some time to study the sales data from comparable properties in the targeted neighborhood in order to establish a reasonable offer price. It is also a good idea to appeal to buyers beyond submitting a financial offer. Consider writing a letter detailing why you want a particular property as part of your appeal. Some sellers are still emotionally attached to their properties and are much less reticent to sell when they know that buyers have a genuine appreciation for their space.
3. Waiting Too Long to Submit an Offer
Hesitation can and often does result in missed opportunities. If you’ve found a loft for sale in the East Village that you love, honor and acknowledge your sense of urgency and take action. It is also important to note that waiting too long to move forward with the purchasing process could cause your loan approval to expire. This makes it vital to stay abreast of any changes in your approval status, especially if you’ve been house hunting for some time.
4. Failing to Pay Attention to Market Conditions
While you don’t want to get caught up in the panic of a hot market, you do want to remain cognizant of market conditions and their impact on your prospects. Talk to your agent about the different neighborhoods you’re targeting and find out which units are moving the fastest in this area, how long listings are staying active, how much extra you’re likely to pay for a condo, loft, or penthouse you really want, and whether you’ll be dealing with lots of competition in your price range. Knowing these things in advance will allow you to adapt your purchasing plan and maybe even the timing of your purchase to better suit your spending goals.
Still shopping for a condo, loft, or Downtown San Diego penthouse for sale? Don’t go at it alone. Competition in Downtown is often fierce, and an experienced agent can help you decide when to pounce and when to be patient. Reach out to us today at (619) 649-0368 and schedule an appointment!