Thinking of buying a home in Washington this spring? Prepare for some stiff competition.
Spring is the most popular time of the year to buy or sell a home. For buyers, nicer weather makes the experience of shopping for a new home more pleasant than trudging through the cold. And sellers know that their homes show better with flowers blooming out front than with ice covering the sidewalk.
Many families look to buy in the spring so that they can get settled in before the kids start a new school year in the fall. The timing can also be right for those looking for homes that might need a little work — buying in the spring means you can get into your new home and make the necessary improvements before next winter.
All the benefits of buying in the spring means that there is also increased competition. In Washington, the spring housing market typically runs from March through June. This year, it’s going to be an especially competitive market as inventory continues to be a challenge. According to data from Bright MLS (formerly MRIS), January was the ninth consecutive month of declines in year-over-year inventory levels in the Washington region. The industry is selling homes faster than new ones are coming on the market. If you are a seller, it’s a great time to list.
We can expect some uptick in inventory as the spring market gets underway. But if you’re serious about buying a new home in Washington this spring, you should be prepared to compete with other buyers. Here are a few steps you can take now to increase your chances of getting the home you want this spring:
• Make a list of must-haves. Look online at homes to get an idea of what you like and what you don’t. The more you can define the kind of home you’re looking for, the faster you can put in an offer when you find the one. Consider the features your new home must offer for your family to live comfortably, and what you can live without. In this market, all buyers should be prepared to compromise, but not on the most important of your must-haves.
• Scope out favorite neighborhoods. Start to narrow down the list of where you want to be and where you can afford to be. Try to get a real sense of what it would be like to live there before you commit your home search to one area. Drive through your top neighborhoods at different times of the day and week, test out your commute from the neighborhood during rush hour, and visit the local shops and restaurants.
• Interview real estate professionals. In such a competitive market, you’re not going to want to go it alone. Partner with an expert to make an informed decision. Real estate professionals can offer information and expertise not available through online property listings. Real estate is all about location, so consider hiring an agent who specializes in the neighborhood or neighborhoods where you want to be to give you a leg up on the competition. Only real estate professionals have access to the “coming soon” listings in the multiple-listing service. They can alert you to listings that will be coming on the market in the next 21 days that meet your requirements.
• Get your financing in order. When you find the home you want this spring, you’ll want to be prepared to put in an offer right away. This means you’ll need to have all of your financing already in order. Make sure that your credit is in good shape and that you have enough set aside for your down payment and closing costs. The most attractive buyers will be prequalified or, even better, preapproved for a mortgage, so also consider meeting with your lenders now.
According to data from Bright MLS, the average sold-price-to-original-list-price ratio for homes in the Washington area last year was 97.5 percent, so you should also be prepared to pay list price or close to it.
Once you know what you want, what you can afford and where you want to be, start shopping. Online resources are a start, but open houses are still the best way to get a look at property you’re considering.
This spring, we can expect the home-buying season to be busy and competitive. To position themselves for a successful purchase, buyers should start preparing now.
Jon Coile, chairman of Rockville-based multiple-listing service Bright MLS (formerly MRIS), writes occasional commentary on the Washington-area housing market.