There’s never been a better time to buy a home…unless the buyer is financing the purchase. It’s not because it is difficult to finance real estate or that the banks aren’t lending, it’s because the entry level real estate market is chock full of cash buyers and the super affordable inventory is gone.
The Southwest Florida real estate market can remove that big scarlet “drowning in inventory” sign it’s been wearing around its neck for the last few years. The original deluge of foreclosures and short sales which flooded the area has, for the most part, been absorbed. For the record, I did say original deluge. I don’t want the sticks and bricks fatalists to have absolutely nothing to wring their hands over.
At any rate, one would have to actually be a first time home buyer or someone with the ambition to get in on affordable, entry level home ownership to feel the pressure. All of the starry eyed dreaming and careful planning aside, the first time home buyer of today is entering a combat zone trying to purchase a home these days.
Today’s successful first time home buyer is always prepared, has already found an experienced mortgage broker and a dedicated real estate agent who can drop everything morning, noon or night to get them into the latest listing that just hit the market. These buyers have been prequalified to purchase, been saving their dollars, tidied their credit and set off for the hunt, only to start placing offer, after offer, after offer and not getting awarded the contract.
Those who decide to live the American dream through the joys of home ownership can barely catch a break if they’re financing their purchase in the entry level market. How could that be?
Cash talks and financers walk…to the next available property that will, like the others before it, hit the market, receive multiple offers and call for highest and best offer by 5 p.m. The contract will likely be awarded to a cash buyer about 81 percent of the time if the purchase price is under $100,000 and 61 percent of the time priced under $150,000. Pretty tough odds, huh?
Wide eyed, first time home buyers become frustrated and if they’re not on the proverbial home buying band wagon when they start dabbling in the home buying arena, they get there quickly after a couple of smack downs by home sellers who step right over them for a buyer with cold, hard cash in hand.
Generally, cash buyers serve a very important place in the real estate market. They’re the buyers who can purchase real estate that is not financeable or the damaged and derelict properties needing extensive repairs. Unfortunately, there just isn’t a whole bunch of affordable real estate to go around, again, so they’re able to squeeze in and make the deals.
Besides digging up a cash benefactor there isn’t a big secret first time home buyers should know to help them get awarded the contract on the next property they place an offer on except speed, perseverance and luck. Luck, in this entry level home buying climate, is simply when thorough planning and preparation meets opportunity. So, if the goal is to buy a home in Southwest Florida in the entry level real estate market, get your home buying team in order, plan your purchase, prepare for the financing, search every web portal, every publication and keep finding and quickly offering on new real estate opportunities until good fortune shines on you.
On a separate note, this would probably be an excellent time for someone to come up with a first time home buyer’s version of the St. Joseph statue.
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Chris Griffith is a real estate agent at Downing-Frye Realty Inc. in Bonita Springs. If you have a question about local real estate or Bonita Springs, e-mail her at chris@LifeInBonitaSprings.com.