If you’re like me, you also stay up late scrolling through Zillow and other homebuying sites, adding entire houses to your wishlist like it’s Amazon. You might even think to yourself, “Hey, maybe one day I could buy this place!” Heartbreakingly, as of late, houses are going under contract in less than 72 hours after being put on the market.
At the beginning of this year, my boyfriend Dante and I decided to try and buy a house — and boy were we in for a rude awakening. For months, we did research on the homebuying process and read every story published in Apartment Therapy’s Real Estate section. While we started the year off with confidence — ready to begin the next chapter of our lives — we were quickly humbled by the dreaded seller’s market and all the other things we didn’t know we didn’t know.
Since January, we’ve found over 30 homes that we loved, toured about 20, and put in at least five formal offers to no avail. Trying to buy a house in your 20s, in a seller’s market, and in a popular city like Atlanta can be a soul-crushing journey, but we haven’t given up. We’re still looking and still learning. Here are three things I wish someone (really, anyone) would have told me about starting a house hunt right now.
You’ll need to have cash before closing for “earnest money.”
Before actually looking for a house, I thought you only needed money at the closing. That’s not the case. After your offer is accepted, you should be prepared to give the seller a cash deposit of 1 to 3 percent of the purchasing price of the house as a sign of good faith. This money is typically held by the closing attorney, but it lets the seller know that you’re serious about buying their house.
There’s a big difference between a seller’s and a buyer’s market.
Y’all, this is a big one. So, a buyer’s market is a time when there are a lot of homes to choose from so the buyer has a ton of leverage. This means that homes are priced pretty low, and sellers may have to jump through hoops just to get offers. This is the ideal market to buy a home in.
Unfortunately, a seller’s market is the polar opposite, and it’s what we’re in now. If your real estate agent tells you that it’s a seller’s market, that means that there aren’t a ton of houses available, and the ones that are on the market are pricey (and can sell for more than their listing price). For example, a house that was bought for $170,000 five years ago could be listed for $205,000 today, and someone may buy it for a final price of $220,000. That’s a $50,000 gap, meaning that sellers have all the advantages and get the sweet end of the deal.
Don’t rush, but be prepared to move quickly.
Homes can be off the market in the blink of an eye. My grandma’s advice is always to “take your time and weigh the pros and cons,” but while you’re taking your time, someone else will take your house! For example, on Tuesday, Dante showed me a house that was listed on Monday night. We agreed that it was great. Our real estate agent immediately booked the next available showing for Wednesday night at 7 p.m. At 2 p.m. on Wednesday, our agent called to let me know the seller already accepted another offer. The house went up on Monday and was taken by Wednesday. Things can move that fast. If you see a house you love, you may see it, tour it, and submit an offer all within the same day.
I definitely don’t want to deter anyone from buying a home, especially if you feel like you’re ready. Just be prepared to put on your walking shoes, because you might have to see a whole lot of houses before you get “the one.” Pick a real estate agent you trust, a partner you can lean on, and home that’s worth fighting for.