Guest Column: How to increase your advantage in a competitive housing market
Published on: September 29, 2017
Taylor Maury, Memphis Business Journal
Inventory, inventory, inventory!
This remains the battle cry responsible for the dramatic increase in home values that we’ve seen lately in the Memphis residential market.
This residential renaissance is certainly not a negative but rather a byproduct of the many growth initiatives and positive developments our city leaders have been pushing and preaching about for years now.
The result of urban expansion is growth and the attraction of new people to our great city. As Memphis continues to evolve and advance, I think of the old saying, “A rising tide lifts all boats.”
This boost in the local economy is causing increased property values and competition within home markets in desirable areas for young people wanting to start a family.
But, baby boomers are not downsizing out of these homes as retirement-age people once did, causing inventory problems for younger buyers eager to upsize. With inventory low relative to demand, multiple-contract offers seem to be the norm as the market ignites the $250,000-$450,000 price range.
In order to keep up with the rising market, it is significantly more important to undergo an in-depth review of your finances, especially if a home purchase, upgrade or renovation is on the horizon.
There are enough things to consider when buying a home — one of them shouldn’t be the question of if you can afford it.
And, when inventory is so low and home sales are so expedited, I witness frustration in the home-buying process, mostly due to the potential buyer’s simple lack of preparation.
Therefore, the best advice I can give is to get pre-qualified, which is an easy step to get you one foot closer to your dream home. During pre-qualification, the bank will review your credit and income, then draft a cost analysis specific to your price range.
A pre-qualification letter will then be provided, which gives your realtor leverage in contract negotiations. It also gives you, the buyer, more credibility, which is essential in today’s multiple-offer environment, as countless buyers lose out simply because they aren’t pre-qualified or are offering too low of a bid.
Because of the combination of high residential values, historically low rates and a diminishing Memphis inventory, it is seriously recommended you contact your lender for a financial checkup.
Scenarios in which houses on the market receive multiple offers and subsequently sell above asking price have become the standard.
Contact your bank and give yourself the competitive advantage needed in today’s fast-paced real estate market.