Have you been interested in becoming a homeowner, but have concerns over the recent trends in the housing market? In recent years, there has been a very high demand for housing due to a low number of available houses, making it a seller’s market, and now rising interest rates intended to stabilize inflation have made it more expensive to borrow money. If you are interested in buying a home in Knoxville, Maryville, Lenoir City, Oak Ridge, or Gatlinburg, Tennessee, and have questions about buying a home in the ever-changing housing market, Foundation Mortgage is here to help. Read on to learn how buyers are regaining some of their negotiation power in today’s housing market.
Contingencies Are Returning
Contingencies in real estate are clauses in a buying agreement that specify certain requirements or actions that need to be met before a contract is finalized, and must be agreed upon by both buyer and seller. A contingency is intended to protect a buyer in the event that certain conditions are not met. Some common types of contingencies include…
A home appraisal is an estimate of the fair market value of a property. It is conducted by a licensed and independent appraiser who uses information about the home, the surrounding neighborhood, and recent nearby sales to determine a home’s value.
A home inspection is a non-invasive, visual examination of the physical structure and systems of a home. It is conducted by a qualified home inspector who is trained to identify potential defects and hazards. Home inspections are typically performed as part of the home buying process
A mortgage contingency is a clause in a real estate purchase contract that gives the buyer the right to back out of the deal if they are unable to secure financing. This is an important protection for buyers, as it ensures that they will not be stuck with a home they cannot afford
Since the housing market was so competitive the past couple of years, buyers have been compromising contingencies in order to ensure a home purchase. There has been a recent shift in these instances, however, and now fewer buyers have been waiving home appraisals and inspections and more and more sellers are accepting offers with contingencies.
Sellers Have Become More Likely To Help Cover Closing Costs
Closing costs consist of the processing fees it costs to create a loan, and are required to be paid in the final stages of the home buying process. They typically cost 3% to 6% of your overall loan amount, and they can be negotiated. In fact, before the pandemic, sometimes the seller paid a portion of closing costs. As the market continues to change, more sellers are beginning to help a buyer out with closing costs in order to make it a better deal. As you search for a property, you can try to use this as a negotiation tool to help you become a homeowner since the demand for housing is slowing down.
Get Assistance Negotiating The Purchase of Your New Home
Even though becoming a homeowner has been more difficult the past few years due to the strong competition in the market, negotiating for a better deal seems to be making a comeback, which is welcome news for potential home buyers. If you need help navigating the real estate market in Knoxville, Maryville, Lenoir City, Oak Ridge, or Gatlinburg, Tennessee, contact Foundation Mortgage today for a consultation. We can work closely with you to find the best mortgage for your situation.