A growing side effect from the pandemic real estate frenzy has been an uptick in reports of buyers who have regrets about their home purchase. Many who recently bought now feel that they have overpaid for their homes or have found that they were not prepared for the maintenance needs and costs associated with repairs and renovations.
It is easy to get caught up in the extremely fast moving pace this market demands at times and to deviate from your original home buying plan or intentions. We move the goal post by expanding your search to less familiar areas or stretch your maximum offering price to find more inventory. You feel pressure to compete so you remove any contingency that you’re able to when writing your offer(s) just to get a house. When you do finally get the news that your offer has been accepted, perhaps you are feeling a bit disadvantaged having given up so much, but relieved to have something under contract. Given the circumstances and uncertainty we were faced with during the pandemic it is not surprising that so many people have possibly not been making their best decisions.
Even the most seasoned industry professionals have found the market conditions to be challenging times to help and advise their buyer clients. With prices seemingly on steroids, timeframes pumped up to hyper speeds and the normal course of events for residential real estate transactions bypassed entirely or drastically altered, many agents are seeing that their buyer clients are becoming fatigued. Home prices will continue to rise, though at a slower pace, and inventory is projected to remain tight in the foreseeable future. If you are shopping for a home and you want to feel good about your home purchase as an asset and not have it weighing on you as a liability, then you must stay centered.
Moving forward with submitting an offer should only be done after thorough examination of your overall financial position. Is it necessary that you make a move right now or should you work on your credit score and save up more for your closing costs and a higher down payment for one more year? You should not be moving forward with submitting an offer because you feel bad about wasting the time of your agent or lender or because your friends have been talking about buying. Ideally, you should be fully prepared to purchase this specific property for the price you’ve offered no matter how many other offers you have already written on other properties because this could wind up being THE ONE every time you put an offer in.
If your situation permits, then allow yourself plenty of time to look for what you need to have and remain patient in your search. Keep the end result in the forefront of your mind and know what details you are unwilling to compromise on or settle for. Sometimes buyers will continue to visit properties during the evenings and weekends when they are available to for many months, a year or longer. If you need to take a few months off to regroup or place your attention elsewhere then do so and resume your search with fresh enthusiasm, and perhaps wisdom.
Keep your expectations in check by searching in a price point lower than your upper limit of what you are willing to spend (which may be a different amount than what you are eligible to spend) so you have room to go over the asking price when necessary to compete. We have seen an exponential increase in the usage of escalatory verbiage included in agreements. This clause is used in a multiple offer situation as a buyer strategy to outbid all of the other offers. A purchase price is offered, and the buyer then discloses their escalated offering price to meet and exceed any other higher offers. Buyers should use caution when using an escalator and it’s also worth noting that many sellers prefer to work with offers which do not have an escalated price and have the buyer instead understand the price they are offering to pay for the property.
Maintaining clarity of purpose and a forward-thinking attitude will help to sustain you during your search and assure you do not wind up regretting your home buying decisions.
Nicole Foster has been serving buyer and seller clients in Southern Maine since 2005 and is a Broker with Locations Real Estate Group.