PROVIDENCE, R.I. (WPRI) — If you’ve been searching for a new home and just can’t seem to close on a deal, a local realtor tells 12 News that patience is key, as well as being prepared.
For months, the housing market has been booming. Data from the Rhode Island Association of Realtors shows in the first quarter of 2021, homes closed in an average of 41 days, and realtor Vivian K. Humphrey says the market continues to be extremely competitive.
“We ran into people who were paying cash. They were paying up to $50,000 over the asking price,” she said. “You’re competing with cash buyers on these first-time homebuyer properties, flippers, condos … everybody wants to buy to rent.”
Humphrey is a licensed realtor with EXIT Realty Re-Imagined. She said on average, prospective homebuyers are putting out offers on eight homes before one is accepted.
“I had one client just say, ‘I’m going to take a pause and back off until maybe the fall,'” Humphrey recalled, saying some of her clients are feeling frustrated.
Low inventory continues to drive up demand, according to Humphrey.
Additionally, the National Association of Home Builders says since April 2020, the cost of lumber has tacked on close to $36,000 to the average price of a new single-family home.
“Right now, [interest rates] are low so people want to get in on that money market before the houses get much higher,” Humphrey said, citing yet another factor in the heightened demand.
Humphrey offered the following tips to homebuyers:
- Be prepared by getting pre-approved by a lender
- Shop below your budget and submit your best and highest offer first, but give yourself some wiggle room
And if you’re afraid you’ll sell your current home before you find a new one, Humphrey said there are ways around that.
“They could write into the purchase-and-sale agreement that ‘the sale of the home is contingent on the seller finding a home,'” she explained.
She also highly recommended signing with a buyer’s agent.
“They work exclusively for you,” Humphrey said. “A buyer’s agent is someone who has a contract, a signed contract with a buyer.”
Humphrey said the number of homes up for sale started to dwindle in 2018 but the pandemic caused the market to explode, and it’s unclear if it will slow down any time soon.