Local real estate Q&A
YOUR JOURNEY HOME
Free Press Real Estate Columnist
Q : It’s getting pretty close to the end of the year so as a possible first-time homebuyer I am wondering if I can expect home prices to come down this time of year or whether there is any other advantage to buying now rather than waiting for the new year?
That is a very interesting and one that a few buyers ask every year about this time. Interestingly, this week, I also received an inquiry from a seller asking about their side of the buying-selling equation.
For a buyer in the Grand Junction housing market, I have not noticed seller’s engaging in wholesale price reductions this time of year. There may be a few sellers who waited until this late in the year to realize they are better off with tax ramifications of selling before the end of the year rather than next year.
Looking at the MLS statistics for the month of June in 2012 and 2013, and then comparing that to December 2013, the average and median prices are within nickels and dimes of one another. What is interesting, however, is that there were about 40% more homes sold in both those Junes than in December.
So fewer buyers are purchasing in December but they are paying the same prices as others paid during the summer.
Q: The Realtor who lives next door keeps telling me to get pre-qualified before I get serious about looking at houses for sale. How can I know what I want a loan for if I do not know what I want to buy?
Let’s see, is that the old chicken and the egg dilemma? Well, not really.
Your Realtor/neighbor is advising you that the chicken has to come before the egg. By making a free visit to a mortgage company to get pre-qualified for a loan, you will know how much they say you can afford to buy. It is perfectly fine to be told by a lender that you can qualify to buy up to a $275,000 house; then you decide either that is fine or you might decide you want a lower payment so will buy a less expensive house.
On the other hand, if you go out and find a $210,000 house that you set your sights and heart on only to be told the next day when you go to the mortgage company for the first time that you qualify for a $150,000 loan, it can be both heart-breaking and frustrating.
Pre-qualifying also puts you in position to move quickly when the house you want comes up for sale. Any Realtor can tell you stories of clients who did not get to purchase the house they wanted because they had to delay making a purchase offer while they went to the mortgage company. In the meantime, some other pre-qualified buyer swept in and bought the house because they had their pre-qualification letter ready, in hand so to speak, the day the house came to their attention. And note: Sellers require that letter along with your purchase offer to even consider your offer.
Listen to your neighbor’s advice and at the same time ask him/her for the names and contact information of two or three mortgage lenders they recommend. Mortgage loans are a product you can shop around for.
Doug Van Etten is a local Realtor with Keller Williams Realty. He has been helping buyers, sellers and investors achieve their real estate goals for more than 20 years. For more information on investing and investment properties, consider joining the Real Estate Investors Network (REIN), http://www.REINWesCO.org and read Van Etten’s blog http://www.GJRealEstateAdvice.com.
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