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Estateagents Explained

Every few years the housing market rewrites the rules, and buyers who learned the last set of rules show up unprepared for the new ones. Right now, the rules have changed more than they have at any point in a generation. The buyers who understand that are finding deals. The ones who do not are making expensive mistakes.

Home prices at the national level have held close to their peaks despite a sharp rise in mortgage rates. The reason is supply. A seller who bought in 2021 at a three percent rate has nowhere affordable to go if they list today, which means the correction that many analysts were expecting simply did not materialize the way the data suggested it should.

Affordability, by the standard measure of what share of median household income goes toward the monthly payment on a median-priced home, is near its worst level since the early 1980s. That is a real problem, and it is not going away quickly. But affordability being stretched does not mean prices are about to fall sharply. What it means, practically, is that fewer people can compete for each property.

Before you look at a single listing, get your mortgage pre-approval completed and in hand. Not a rough estimate. Not a verbal confirmation from a loan officer you met once. A full pre-approval based on verified income, tax returns, bank statements, and a hard credit pull. Any agent worth working with will tell you the same thing: no pre-approval, no offer.

The inspection is where the marketing copy meets reality. Be there with the inspector and ask questions throughout. A good home inspector will walk you through what they are finding as they go, and the conversation is often more valuable than the written report that follows.

Budget between two and five percent depending on your loan type and the state you are buying in. First-time buyers routinely underestimate this number. Ask your lender for a Loan Estimate as early in the process as possible.

Real estate is illiquid. Buying and selling inside two years is almost always a money-losing proposition once you account for the full cost of both transactions. None of that means do not buy. It means be honest about your time horizon before you commit.

Real estate rewards preparation more than it rewards timing. Waiting for a better market is a reasonable position only if your personal situation supports it, otherwise you are just paying rent while prices hold. Check up-to-date property listings and see whether what is available matches what you have been planning for.