Is (the market) overvalued by 20%? No. Due to the lack of supply and high demand, the market is showing low monthly supply, which means as a result, there will be multiple offers, in some cases above market price.
We are seeing a shortage of inventory and homes are being purchased above the asking price. It’s safe to say that in the South in general, I don’t see any indicators showing that if you buy now there is a good chance you will lose value. All I see is positive benefits.
If we had high supply, then you and I would have a different discussion.
Q: How can you find a property that will hold its historical value?
Dee Emmanuel: Essentially the most important thing is you just have to buy in a neighborhood that justifies the value. School districts play a big factor, as well as from a commuting standpoint and the family’s lifestyle. You are buying location.
Q: How can you get a leg up on finding newly listed homes ahead of the pack?
Linda Bright: You do need to be working with someone actively in the market who knows exactly what’s going on and has connections with other agents. We all speak to each other. That is one way to know when things are coming on the market, for sure. The agents that have longstanding relationships are connecting with people.
Q: Is it worth the time to try to find an off-market home?
Gary Finkelstein: A hundred percent. Because inventory is so low, an off-market property is much more advantageous to you. Then you’re not dealing with the rest of the market. If you start knocking on doors to try to find a better property, you’re not fighting with other potential buyers. Two of my properties I purchased I’ve knocked on doors. I said, “Hey, are you interested in selling? How much would it cost for you to leave this property?” I bought a property for $350,000 and now it’s worth $750,000. It’s always an advantageous thing to try to get your foot in the door before somebody else.
Dee Emmanuel: A seller may have leverage … because they know you need a home. There is nothing wrong with off-market deals as long as the seller’s expectations on price are realistic and they’re motivated. If you are in a contract there could be issues you want to negotiate. The seller says, “You called me, I’m not looking to sell, but for this price I am.” If the seller is not realistic in price, it could result in your overpaying.