The average home buyer spends about 17 weeks shopping for a home before buying one, according to a new report from Zillow on consumer housing trends, and 54% of buyers don’t land the first home they make an offer on.
That means if you started house hunting at the beginning of June, you wouldn’t settle on your house, on average, until the end of September.
“Inventory is so low right now, it’s tough to find a home,” says Jeremy Wacksman, Zillow’s chief marketing officer. “Given how competitive the market is, the findings didn’t really surprise us.”
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With so few homes to choose from, would-be homebuyers are also considering renting. Among those who purchased a home in the last year, two-thirds of Millennials also thought about renting. Fifty-four percent of Generation Xers and a third of Baby Boomers considered renting.
“If you are a buyer, half the folks you’re competing with are dual tracking, they’re considering renting at the same time,” Wacksman says. “It’s a really valuable option to have on the table, since you can’t count on getting that first home you make an offer on. Not putting all your eggs in one basket is a smart strategy.”
Given these results, other smart home-buying strategies include:
Get in the game early. If you’re thinking about buying a home, meeting with a realtor four to six months ahead of when you want to buy is a good idea. The last thing you want to do is end up without a place to live because you didn’t give yourself enough time. Plus, after people buy homes, one of their biggest regrets is that they didn’t take enough time with it. “They say, ‘I wish I’d started earlier,’” Wacksman says.
Get preapproved. A mortgage preapproval can help you determine how much house you can reasonably buy, given your income and assets. “That’s a really good step to get through to understand what you can afford,” Wacksman says. Second, being preapproved shows sellers that you’re serious about buying, and that can give you a leg up in a bidding war.
Find a good agent. A talented realtor can help you win the best home. Look at a realtor's ratings on online sites, and browse their past transactions to see what market and price range they tend to work in. "It pays to spend the time doing this," Wacksman says.
Have your money squared away. If you have 20% available for a down payment, you’re in great shape. That’s the holy grail of down payments. Otherwise, just make sure you know where the money is coming from, whether it’s loan from a family member or financing entirely from the bank.
Act fast. If you find a home you like, go for it. “Be the first offer, and don’t be an insulting offer,” Wacksman says. “This isn’t the time to lowball or try to negotiate, especially in a hot market.”
