A recent survey by RE/MAX reveals that the current housing market has led nearly 80% of prospective homebuyers to consider adjusting their homebuying plans. In the past, buyers would find a house, bid on it, and close the deal. However, many buyers are now facing challenges right from the start, and those who do make it past the initial step often find themselves in bidding wars they can’t win.
One interesting finding from the survey is that 56% of respondents would consider purchasing a fixer-upper, while 90% would consider buying a foreclosed home. Christy Walker, a broker/owner at RE/MAX Signature in Phoenix, Arizona, finds it intriguing that such a high percentage of buyers would consider a fixer-upper. She explains that many buyers have unrealistic expectations due to the influence of shows like HGTV, and they are often shocked by the actual condition of homes during their first tour.
However, Nick Huston, an associate at RE/MAX Professionals in Stillwater, Minnesota, believes that a fixer-upper can be a great choice for the right buyer. He advises getting a thorough inspection and budgeting for hidden repairs that may increase the overall cost.
The survey also found that 34% of respondents would consider purchasing a home with a down payment of less than 20%. Huston explains that this is not surprising, especially for first-time homebuyers who may not have saved up 20% yet. He suggests using the extra savings to fix up the purchased home or pay off other debts.
Walker points out that many buyers have believed the myth that a 20% down payment is necessary, but they are now realizing that there are programs available that allow for a lower down payment. However, she recommends not buying a home with less than 10% down unless there is a down payment assistance program involved.
The survey also reveals that 17% of respondents would consider borrowing money from family or friends for their down payment. Walker sees this as a great way to get started and build wealth and stability for the family. However, she advises discussing this option with the lender and getting approval, as there may be underwriting guidelines that restrict borrowing funds for the down payment.
Lastly, the survey found that 13% of prospective homebuyers would consider buying a more affordable home that is two or more hours away from their workplace. While this may seem like a cost-saving option, Walker cautions against it, as it adds additional expenses for gas and car maintenance and takes away valuable time.
Overall, the survey highlights the creative strategies that homebuyers are considering in order to navigate the current housing market challenges.
