DENVER -- To buy or not to buy? It’s the question potential homebuyers across the country are asking themselves, after mortgage rates hit a new record low.
Mortgage expert David Shamansky says these days you can buy a home with little down, and you don’t need perfect credit. He says it’s a no-brainer for renters.
"Anybody that’s renting right now that’s paying $900, $1,000, $1,100 or more in rent – the question is why? You can buy a $200,000-300,000 house for similar or less than what you’re paying in rent right now," Shamansky says.
Even if you think you may leave in 3-5 years, the values of homes are increasing at such a rate that Shamansky says it would still be worth buying. But, he cautions, there are people who may not want to consider buying. People who don’t want to be in Denver or anyone who has a big change in lifestyle coming up.
Experts say, these record low rates will continue to drive the housing market recovery. Motivating more people to buy and creating even more competition for buyers.
The problem is that in Denver, “for sale” signs aren’t staying up for very long. Supply just can’t keep up with demand. When the demand is bigger than supply, prices go up and people have to outbid each other for choice properties.
As we reported earlier this week, home prices in metro Denver are already up 9.9 percent from one year ago. Now, low interest rates boost home buyer demands and send home prices even higher.
We sat down with local realtor Thaddeus Howells to get some tips for buyers ready to jump in. He says, “Homes are selling within days of being listed so buyers should be ready to compete.”
First, Howells says, talk to your lender, and have your down payment ready to go.
Buyers right now are often paying more than the asking price because of multiple offers.
To avoid pricing yourself out of your dream home, Howells recommends starting your search well below your price point. Look at homes that are below what you want to spend, and then you leave yourself room to bump up your offer in the event of a bidding war.
And if you do end up in a bidding war, making your offer stand out, doesn’t always mean opening your wallet wider.
There are opportunities to make your offer more attractive without raising the price.
Things like a quicker closing, fewer contingencies, or even a personal touch could put you one step ahead of the competition. A proven method he recommends to his clients is direct contact with the seller. Write a personal note to the seller.
The bottom line for buyers is be prepared and be patient.