First-time home buyers surprisingly optimistic about 2022
Roseville, Calif.- The current competitive housing market here in Roseville and the Sacramento area is difficult for home buyers and particularly on first time buyers. They don’t have equity in a current home to sell and must use savings. The amount they need (down payment and closing costs) has been and will continue to rise. Home prices continue to increase.
A recent survey conducted by Realtor.com indicates only about one quarter of first time buyers were successfully able to buy a home so far this year. We just got a young couple in contract after 13 previous offers were rejected starting in November 2020.
Although 2021 was not a great year for first time buyers, the Realtor.com survey results say, “Despite a challenging year, aspiring first-time home buyers are surprisingly optimistic about 2022. They’re looking at the new year as a fresh opportunity to make their dreams of owning a home come true and our survey suggests that they’re armed with information and ready to compete for their first home.”
The primary tactic, according to the survey is a willingness to make offers over the asking price:
- 32 percent: Up to 5 percent above asking
- 17 percent: 6 to 10 percent above asking
- 7 percent: 11 to 15 percent above asking
- 39 percent – Will not offer above list price
From my perspective there is more first time buyers need to consider if they are to be successful in our current market. These are:
- Shorten or remove contingencies for investigation, appraisal, and loan
- Make offers “As Is” with no seller repairs
- Increase Ernest Money Deposit
- Pay more of the closing costs
The buyers I mentioned above offered 12 percent more than the asking price. Reduced their investigation contingency period from a standard 17 to 10-days. Because of their financial strength they were willing to remove the appraisal and loan contingencies. I addition they offered to pay almost all closing costs. They still had to deal with a Seller Multiple Counteroffer before going into contract. We are currently in escrow and our buyers are thrilled.
If you or someone you know is considering buying, please feel free to contact me MagnumOne Realty office in Roseville at (916) 276-6883 and email at [email protected].
We specialize serving the needs of buyers and sellers of homes in the Roseville and Sacramento area including Sacramento, Placer, El Dorado, Sutter and Yuba counties.