3 Mistakes to Avoid if You’re a Move Up Buyer

A move-up homebuyer is a buyer who currently owns a residence but is now looking to purchase a more expensive and/or a larger property. Last year, 48% of all home buyers previously owned a home. Whether the desire for a larger home for a growing family or a better area, move-up buyers are all ready somewhat knowledgeable in the home buying process, as this is not their first time. Although, these buyers have purchased a home in the past, there are three key mistakes to avoid in their home buying process this time around:

Misjudging the current housing market- Today’s current market is very different from the 2012-2019 housing market. In this past 2012-2019 market, there was way more inventory of in our local area, with properties being on the listed market from anywhere to 1 month to 3+ months before selling. With housing inventories at current historic low, today’s market is extremely competitive and fast paced. Currently, we are seeing properties listed on the market for DAYS, weeks at most. If you are purchasing in this current market, you need to be well informed and understand the house buying environment is different than the past. Hiring a Realtor who knows the market and how to negotiate with other Realtors will give you an advantage as well as being fully approved with a lender versus just “pre-qualified.
Trying to time the market perfectly- Yes, interest rates are rising compared to earlier this year and that does affect homebuyer’s affordability, but typically we see when interest rates are on the rise, the market slows down resulting in a more likely ability to negotiate price and terms, thus making affordability remain rather consistent. So, while interest rates and/or prices tend to be driving factors in timing of your purchase, you should really weigh your own personal timing, needs, and goals over trying to time the market perfectly to get the “best deal”.
Assuming you do or don’t to sell your current home first- There are many ways you can structure your loan application for a new mortgage. Talk to your lender first before automatically deciding to put your current home on the market. You may want to tap into your existing homes equity for the down payment/purchase of your new home PRIOR to putting your home on the market or use proposed rental income on your current home to help you offset qualifying for a larger new mortgage. Weighing all your options with your current home can help combat having to sell first or add a home sale contingency to your new offer. Find out our options for a new purchase today!