Posted by Ryan Womeldorf / Uncategorized / 0 Comment
10 Tips for Navigating a Hot Regina Housing Market
The Regina housing market was one that would seemingly be impacted by the COVID-19 shutdowns. For a short time, that was the case. Beginning in April 2020, there was a slight pause that left many wondering if the market would remain stagnant.
All of those questions have been answered and that slowdown was a brief one. The Regina housing market saw 392 homes sold during the month of April, well over double (144) the number of homes sold during April 2020.
Depending on which side of the fence you are on, this market is either great or incredibly difficult to manage. For sellers, there is not much to complain about. Homes are not only selling quickly but often for well over asking price.
Even better for sellers, they don’t have to jump through the hoops that they might need to in a buyer’s market. Homes that have noticeable issues (foundation, roof, etc.) are still being snapped up because the inventory simply is not there.
A Year Has Changed a Lot for the Regina Housing Market
This time last year, there was a lot of uncertainty thanks to the COVID-19 pandemic. Not only were Canadians being furloughed and laid off entirely, but the housing market was seemingly ready to become stagnant.
But the housing market across Canada, not just Regina, has been anything but. Homes are consistently selling above asking price with several offers coming in the first 24- to 48-hours. There have been more than a few situations where homes were on the market for all of a day before more than 10 offers came in.
Furthermore, the average price for a home has spiked as well. Last year, the average price of a home in Regina was $305,000. This year? That price has shot up nearly $40,000, with the average price being $344,000.
Buyers are left with not much in the way of recourse. Those who know they won’t be the high bidder have tried to add a personal touch. They write letters to the seller, pleading their case. They’ll also include pictures of their families in hopes of landing a property that could sell for more.
How to Handle the Hot Regina Housing Market as a Buyer
As you read above, sellers don’t need to do a whole lot in this market. Having a home available for sale seems to be more than enough for some buyers. Homes that have major issues are still being bought up at or above asking price because the inventory of available homes is simply not there.
So, what can you hope to do in this market as a buyer? Are you simply doomed to wait until the market cools off? Here are a few tips that can help buyers navigate markets like the Regina hosing market and find the home that they have been looking for.
1.) Know What You Need vs What You Want
This is an important thing to know no matter what the housing market looks like. When it comes to a home, there are things that you absolutely have to have and others that you want but could live without.
In a market like this, this becomes even more important. Maybe you would have passed on that home that did not have a master bathroom in a more stagnant market. But if you can live without it, you may be more willing to pass it up to land a home in this climate.
But don’t stop there. When you have a better idea of the things you must have, rank them from the most to least important. Difficult as it may be, you will know for certain what you need and what you can live without when it comes time to buy a home.
If a home only meets most of your needs, but maybe not the most crucial ones, then you may regret landing the home. Depending on your living situation, patience is your greatest asset. The market will not stay this way forever and if it means landing a home that doesn’t fit your needs, it can wind up being the most regretful purchase you make.
2.) Having Finances in Order is an Absolute Must in a Hot Regina Housing Market
Before you even begin shopping for a new home, there are more than a few financial tasks that you should have in order. Some take more time than others but having your financial ducks in a row can save you a lot of time, hassle, and can give you an edge over buyers who don’t have theirs in order.
Start by checking your credit score. Review your credit report. Verify that everything is accurate and take some time to work on improving it if your score is worse than “good”. Your credit score is the most important aspect of buying a home. Even if you get approval, you may be staring down ungodly interest rates.
You should also have money saved for a down payment. Knowing well ahead of time – years, even – that you want to buy a home can give you the time that you need to save. Having 20% down is preferrable to avoid having to pay for private mortgage insurance, but 5% is the absolute minimum.
On top of the down payment, you need money to cover a few other fees. Appraisals, inspections, etc. will add up in no time. Have money saved on top of the down payment to cover them.
Finally, get your pre-approval. Simply being pre-qualified will not be enough in a market like this. Pre-approval means having your finances examined thoroughly by a lender with a promise in writing that you financially qualify. That pre-approval can make all the difference in the world in a market like this.
3.) Have a Knowledgeable, Responsive Real Estate Agent
In a market like Regina’s, your real estate agent is going to become one of your most important tools. An agent that is slow to find new properties and even slower to respond can wind up costing you the opportunity to see homes, let alone offer on them.
An experienced real estate agent is a must in this market. They have a knack for understanding what their buyers are looking for, they communicate well, and devote their time to the buyer. More importantly, they know the area(s) the buyer is searching, able to find homes just before they list.
Don’t just do a cursory Google search, either. Talk to friends and family, especially those who have bought or sold a home recently. Check out reviews left on that agent, seeing what others have had to say about their experiences.
A good real estate agent is important for navigating a hot housing market. An agent that is difficult to get ahold of or is not as proactive as they should be can wind up costing the buyer a house or two, especially in a market like this.
4.) Friends, Family, and Colleagues Can Be Helpful in This Regina Housing Market
In markets like this, buyers find out quickly that any help is good help. Having a proper real estate agent is a must but consider enlisting friends and family in the search as well. That’s not to say they should be brokering deals but that word-of-mouth aspect can be infinitely helpful.
Perhaps a family member knows someone who is listing their home in the near future. A colleague has a relative contemplating selling but does not want to sell to just anyone. Even if nothing comes of telling friends and family, it never hurts having extra eyes and ears on the market.
The point is that, in a hot housing market, buyers need every ounce of help that is out there. Markets like this generate conversation and one of them could lead to a sale. Putting out feelers usually doesn’t lead to a lot, but all it takes is one instance to facilitate a sale.
5.) Communication is Key in Any Market, not Just the Regina Housing Market
When a market is particularly strong, homes often times barely make it to market, if at all, before they sell. That is why it is important to not only search for yourself but maintain strong and constant contact with your real estate agent.
A strong real estate agent will either contact you with listings directly or set up automated alerts based on your criteria. Even then, search for homes on the major listing sites like Trulia, Zillow, etc. There is no such thing has searching too much in a strong housing market.
Don’t be afraid to reach out to the agent and ask what might be done differently to help your chances. More often than not, there is not a whole lot to be done but asking doesn’t hurt anything. Staying in constant contact with the agent will help keep both parties informed as the process moves along.
One final note about communication. When the housing market is hot, as Regina’s is, you have to be clear about what you want in a house. Changing up wants on a regular basis is a great way to frustrate the agent and leave you slow to the draw on a home.
Be clear and up front about what is wanted in a home and don’t waver. If the agent is constantly having to retailor searches, it is time wasted that could have otherwise been used to land a home. Make the process easier.
6.) You Can’t Be Cheap with Your Offer in a Market Like the Regina Housing Market
There is one important thing to know before offering on a home in a seller’s market. There will not be room for negotiation or haggling. Putting in a lower-than-market offer is the fastest way to rejection and nothing more.
In a buyer’s market, there may be that room. Perhaps some aspect of the home needs work and the price can be lowered to accommodate that. But in this market, homes are flying off the market regardless of condition. That means the seller can simply ignore your offer and move on to the next, more likely higher, bidder.
Realtors will encourage buyers in this kind of market to offer full asking price or at least close to it. In more than a few instances, they will suggest bidding over the asking price (and well over it at that). It really depends on the conditions of the market and the home in question.
Offering a high bid (or the highest) will no doubt interest the seller. In most cases, it is difficult for the seller to look past the money. But it is not as simple as having the highest offer on the home in question.
A solid offer can include fewer demands or contingencies to the seller. Putting down more earnest money or even guaranteeing the sale amount past the appraisal can show the seller a new level of seriousness.
There are more factors that go into a quality offer than simply offering the most. While that does not hurt, fewer contingencies or guaranteeing over appraisal are just as strong when it comes time to make an offer.
7.) Carefully Consider Contingencies
Contingencies are things that have to be done before the buyer agrees to purchase the home. In a buyer’s market, it is not uncommon for contingencies to be made about the appraisal, the condition of the home, etc.
It is important to note that, even in a hot housing market like this, the home inspection should never be skipped. Even a home that you desperately want may be worth passing up if there are enough issues within.
In a seller’s market, limiting contingencies may be highly beneficial. Even if contingencies are added, consider making the period for them to expire a bit shorter. Doing so may convince the seller that they won’t potentially impact the sale of the property.
The simplest way to think of it is that contingencies are basically demands. When the market is hot and homes are selling like hotcakes, is it really pertinent to make demands of the seller? Be flexible, be smart enough to avoid a lemon, and focus on trying to get an offer accepted.
If anything, go the other way. Make yourself as accommodating to the seller as possible within reason. Something seemingly small like purchasing existing appliances or furnishings may be enough to gain the winning edge.
8.) Offer Letters Have an Impact in Hot Markets Like the Regina Housing Market
Though touched on briefly above, the highest bid is not necessarily always the best one in the eyes of the seller. More often than not, the seller will take the highest bid or one near the top. But it may not be a bad idea for buyers to appeal to the humanity of the seller, either.
Adding a personal touch to a strong bid might be the edge. Keep in mind that a strong bid is needed. Offering under asking or substantially below the top bids may eliminate any benefit that the personal touch has.
When writing a letter, it does not have to be a dissertation. If anything, it should be honest and from the heart. Tell the seller why you want to buy their home. Mention personal touches that may have struck a chord with you. Share with the seller how you plan to make your own memories in that home.
Including an offer letter is far from a guarantee. But in a hot housing market, the offers can start to look the same and standing out with a personal touch can make all the difference in the world.
9.) That Said, Be Ready for a Bidding War
In a strong seller’s market, the most likely scenario will involve multiple offers. Not just two or three or four, but 10 or 15 offers. Maybe even more. It creates a fierce competition for the home, which can be a slippery slope for buyers.
Emotions can run high, especially when the buyer feels particularly strong about a home. The temptation to bid higher will be there, but the most important thing is to stick to the budget. If you have a little wiggle room in the offer, it is fine to go over your initial high bid.
That said, getting into a bidding war is rarely a good thing. Paying more for the house has long-term financial implications. Making a desperation bid in the heat of the moment is the quickest way to winding up house poor.
Try to stick to the budget. Add some wiggle room in if possible to provide greater flexibility and improve the odds of a max offer being accepted.
10.) Patience and Persistence are a Must in the Regina Housing Market
While it is certainly important to have your financial ducks in a row, a good real estate agent, and a strong offer, there is one more essential. Having patience and persistency in a seller’s market is an absolute must.
Maybe that first offer will get accepted, but the likelihood is low. If anything, it will take four or five offers, often times more. That is okay. It may feel like you need to find a home right now before someone else snatches it out from underneath. The fact is that finding a home is a marathon, not a sprint.
Take the time between viewings to review your financial situation, needs and wants, etc. A reassessment may be necessary to provide a better competitive edge. It is also important to consistently and constantly look. It may seem like a full-time job at times, but that is because it requires that level of effort to land a home in a market like this.
Perhaps the most important thing is to not get defeated. Frustration is a normal part of housing markets like these. Use the time that you have between listings to improve the chances that your next offer will be accepted.
SaskEquity Can Help
Perhaps most importantly, have the help that you deserve when finding the right home. SaskEquity has the tools, knowledge and experience to help you every step of the way. Going it alone means running into situations that you are not prepared for.
By having a guiding hand like SaskEquity in the mix, you can feel comfortable and confident during your home buying journey. Don’t find yourself in a position you would otherwise like to avoid. Let our team help you through the homebuying process.
Navigating through a tough housing market can feel scary and, at times, impossible. With SaskEquity at your side, you can not only find the home that you have been looking for but avoid giving up your rights. More importantly, you can avoid falling into a money pit of a home that has dragged down countless buyers before.
