There is no question that the real estate market is red hot right now, particularly in South Florida. With this said, inventory is also at historic lows making this a particularly challenging market for buyers. While this can be a frustrating time for homebuyers, it is important to not make any of the common mistakes that we see in these competitive markets. Below we will highlight 4 of the most common mistakes that you will want to avoid.
4 most common mistakes
- Neglecting to understand the local real estate market: This mistake is most often seen when buyers are relocating from more affordable markets to higher-priced markets. For example, the median home price in Tennessee is $164,500. Meanwhile, the median home in South Florida is approximately $425,000. As you can imagine, someone relocating from Tennessee would certainly be in for some “sticker shock” upon arriving in paradise. Every real estate market is different, and you should always educate yourself on local market trends.
- Allowing desperation to enter the equation: Inserting desperation into any strategy typically does not end well. It is certainly no different in real estate. Although the current tight housing inventory can be quite frustrating for buyers, it is important that decisions are not too rushed. This may lead to overpaying for a property, overlooking inspections, or even committing to unrealistic closing dates. While there may be a sense of urgency, the approach must remain disciplined to avoid critical errors.
- Overpaying for a home: This is the unfortunate result of allowing desperation and emotion to enter into the equation. It is critical that buyers set a strict budget criteria prior to embarking on their home search. This disciplined approach combined with a strong collaboration with a local and knowledgeable real estate agent can help avoid this pitfall. By removing any emotion, the buyer can consult their real estate agent to analyze the comparable closed sale data to best determine a fair market value for a property.
- Taking too long to make an offer: This may very well be the most common mistake that we see with buyers in the South Florida market. In such a hot real estate market, educated decisions need to be made in a timely manner. One thing that buyers often forget is that even if an offer is accepted and the property is under contract, there should be an inspection period. During this inspection period, the buyer is allowed to perform his/her due diligence on the property. If the buyer is not comfortable with moving forward with the purchase, they may submit a release and cancellation of contract prior to the expiration of the inspection period. We have seen too many buyers hesitate to make an offer, only to regret losing out on the property in the end.
In closing, a prepared and organized buyer should be able to navigate this competitive market. However, it is critical to have a local and knowledgeable real estate agent assisting in the process. It is highly advisable to have your real estate agent place you on automatic listing alerts for properties that hit the market and meet your search criteria. It is equally important to remain flexible to be able to view these properties as soon as they hit the market as well. Just remember, if you are able to get a property under contract, you will still have time during the inspection period to evaluate the decision. Do you have questions about the South Florida market? We can help. Contact Live South Florida Realty, Inc. today!