Do your homework, then start looking
Q: I’m thinking about buying a house and have been looking online and have seen a few houses. Nothing I see is exactly what I want. I know houses are selling quickly, but I don’t want to get into a situation where I feel pressured to decide on a house that is not quite perfect. How should I approach the process? I feel lost and nervous.
A: It’s true (depending on the exact area) houses are moving much more quickly than they had been a year, or even a month ago. The short answer is to have a clear idea of the house you want before seriously looking. Deciding which house is for you is much simpler if you have firm criteria. But that’s easier said than done. Often figuring out what you want (especially in a seller’s market) is a multi-step process and takes some work. It’s important to do this work if you’re going to find and buy a house in a rapidly moving market.
First, talk to a lender (or decide how much you want to spend if paying cash) and figure out what you can afford. Now you can consider what you want in a house: location, size, style, condition. Take a look in the MLS (the multiple listing service) or have your Realtor send you listings which meet your criteria and budget and get a sense of the market. If you’re one of the lucky, what you want is actually available in your price range. If so, great! Now you can start looking. But most people have to compromise on what they want based on what they can afford. You might need to change area to get the size and condition house you want, or change the house to get the area you want.
After you’ve determined what you want (and can afford) it’s time to get serious about finding a house. With prices on the rise and houses going quickly there is naturally some pressure to make decisions quickly after seeing a house. But you don’t want to be too rushed. After all, this is a big financial purchase, and you want to do it wisely. That said, houses can go quickly and you don’t want to miss out. When you’re thinking about “sleeping on it” ask yourself, “How will I feel if the house is gone tomorrow?” If the answer is “just fine,” then sleep on it. The house might not be the right one for you anyway. But if you will feel sad, panicked, or like crying … maybe go ahead and make an offer right away. You may not want to feel pressured, but that’s the market we’re in. You may not get to negotiate much. You may be in competition with multiple buyers. And you may need to move very quickly to get a house at all.