7 Tips for Buying a Home in a Hot Market

Keep these tips in mind as you search for your next home.

1. Decide What You Want: Before you start looking for a home, list the features that you want your home to have. Start by brainstorming all of the qualities in an ideal home, including location, size, acreage, and specific features like the presence of a garage.
   
   Next, look at those qualities and pick out your must-have features. When you view properties, it’s easy to get swept up in appealing perks while overlooking that a home lacks some of your essentials. Keep referring back to your must-haves list to help keep you focused and objective so you can make sure that a home is truly right for you.

    

2. Get Pre-Qualified: Take the time to get pre-qualified for a mortgage. Your pre-qualification letter will not only help you better understand what houses may be within your budget, but it’s also essential in a hot market. Since sellers receive multiple offers, most sellers won’t consider your offer unless you’re pre-qualified.
   
   
3. Find a Real Estate Agent You Can Trust: Your real estate agent is an important partner in your home-buying journey, so take the time to find an experienced and trustworthy agent. Research local agents specializing in the type of house or the area you’re interested in. Then, interview your top candidates, ask for references, and follow up with those references to get a sense of what working with the real estate agent will be like.
   
   

   Once you’ve chosen an agent, share as many details about your ideal home as possible. The more information you give the agent, the better they can show you homes that meet your criteria.

4. Set Your Limits: In today’s housing market, you need to be prepared to quickly make an offer on any home that you decide you want to buy. It’s easy to get carried away when trying to quickly make an offer, so set your limits ahead of time.

   
   Decide on and write down your maximum offer, so you don’t get caught up in a bidding war. Remember other expenses, like home insurance and closing costs, and make sure that you can comfortably afford your down payment and other home-buying costs. Having these details can help you to stay objective when reviewing home inspection results so you don’t take on more of a project than you want.

5. Make Your Offer Appealing: One of the best ways to buy a house in a hot market is to make your offer as appealing as possible, increasing the chance of the seller accepting it. In a hot market, it’s important to make your initial offer as strong as possible, since it’s likely that the seller will receive and choose from multiple offers.

   
   A large down payment can build a seller’s confidence in your offer and shows that you’re financially prepared to buy the home. Your real estate agent may also suggest that you offer to agree to a closing timeline that works for the seller.

6. Carefully Consider Contingencies: Some buyers are willing to waive contingencies, like a home inspection contingency, to make their offers even more competitive. Think carefully about whether you’re comfortable going without an inspection or other contingencies. It’s a good idea to have already made your decision about contingencies before you put in an offer, so if the seller comes back to you with a counteroffer, you’re prepared to respond.

    

7. Be Persistent: Buying a home in a hot market is challenging, and you’ll probably miss out on some homes that you thought were ideal. Try not to get discouraged, and stay persistent in your search. You may have to submit several offers before ultimately buying your new home, and that’s pretty typical in this market. If a home falls through, keep looking and stay patient. Revisit your offer, continue to save money to increase the size of your down payment, and remember that you will find the right house eventually.