One of the latest crises of the past couple of years is one that has been largely anticipated for years. As Baby Boomers move into retirement and decide to downsize their dwellings, Millennials and other younger homebuyers are looking to purchase their first homes. Unfortunately, what has resulted from that two-buyer, one home situation is historically low home inventories across the country. Couple that with investors seeking out reasonably inexpensive rental properties, and buyers are having trouble just finding homes to make offers on.
But some buyers have managed to overcome the low-inventory housing market by gaming the system and looking beyond what is very readily (and clearly) available in the market. Here’s how buyers are overcoming low inventory in the housing market.
Shopping for Remodels
Perhaps one of the biggest places buyers are looking these days in an inventory-shortened market is for potential remodels. Remodels aren’t for the faint of heart, but for buyers looking to capitalize on a housing market with very few houses for sale, searching for a home to remodel could be a great place to start.
Buyers in search of a potential remodel home may find that there are plenty of homes that haven’t been kept up by previous homeowners, are off the market, or simply just need some work that no one has been able to do or committed to doing. If this is a route you’d like to go, then search for a home that has good “bones”. In other words, look for a home that has a solid foundation, good structure, and is generally devoid of any major structural issues such as faulty slab foundation, termites, etc.
If you’re looking to cheat the low inventory housing market, then a remodel-to-be could be a great place to start!
Another place where buyers are overcoming the housing market right now is searching for homes that are in a state where remodeling or repair just isn’t an option. In other words, finding a home that can simply be torn down and a new home can be built on the same site.
In many instances, buyers will spend a virtual fortune trying to rehabilitate a home that should probably be taken down to the ground. A complete demolition and rebuild can quite frankly be the most cost-effective way to both purchase and build a new home. With land and lot prices already inflated due to the housing shortage, purchasing a lot that already has a home and building new could be a sneaky way to cheat the housing market.
Tearing down a dilapidated home can be a better way to go, but there are certainly some things to keep in mind. Local building codes or city codes may very well dictate just what can and can’t be done to certain structures, so check with your municipality before proceeding. Also, be aware that older homes that have asbestos in them may require asbestos abatement or other professional and extremely expensive processes before you can proceed with a teardown or remodel.
Being Financially Prepared
Another thing that buyers are doing in an inventory-shortened market is being financially prepared before they take on a new home purchase, remodel, or demolition. Not only should you have your financial affairs in order, but if you’re looking at going the remodel or teardown route, make sure you know what you’re getting into and have additional or reserved funds ready for inevitable hiccups along the way.
The best thing to do first would be to get pre-qualified to see just what you can afford. Call one of the loan experts at Tidewater Mortgage Services, Inc. today!