What’s your home buying style? Impulsive? Cautious? Analytic? Deep bargain hunter?
A few times in my real estate career, I’ve worked with Silicon Valley home buyers who were so anxious to purchase a home that I was concerned that their impulsivity might be a cause for buyer’s remorse later. When that happens, I try to slow them down a little – I’ll suggest “let’s look at least a few homes” if it happens that they want to buy the very first home they saw. Part of my fiduciary duty is to look out for my clients’ best interests, and sometimes that means putting the brakes on just a little (or telling them what they don’t want to hear).
More commonly, it’s the other extreme that I see in our very well educated, extremely analytic population: paralysis by analysis or an overabundance of caution. (Sometimes it’s overabundance of bargain hunting.)
The vast majority of successful Silicon Valley home buyers are somewhere in between: they set up their priorities and goals (“I want to buy in the next 4 months at this price with this location or school and this type of property and size of home”). The clearer they are on their goals, wants and needs, the easier it is to help them get it – as long as they have realistic expectations. That is key!
Once – only once – I sold a Los Gatos house in which the husband purchased without the wife’s physically seeing it. This is rare! They had moved so many times that he understood precisely what mattered to her, and if the house met that list, he was good to go.
The national average for the number of homes seen before buying is about 10, but it is more than that here in my experience. If buyers know what they can afford and what they want, often they and I can narrow what’s seen online to 10-20 homes we visit in person and from those, one or two should be a best fit. For highly motivated, determined, realistic and organized buyers, and this can usually happen in 2-3 weeks. (If you are selling one house and immediately buying another, this is really the only way you can swing it without having to rent in the interim.)
What are the odds of successfully buying a Silicon Valley home this year?
How likely is someone to buy a house or condo? It varies, of course. As a Realtor who is not in it for one transaction but instead for a long term relationship, I want to help consumers to make good choices. It is usually easier to slow down the impulsive home buyer (note: not all real estate licensees will do this, some just want to make a quick sale) and harder to move someone who’s bogged down by unrealistic expectations or exaggerated fears to the middle zone where they are able to write a successful purchase offer on a home.
Most of the time, capable buyers who don’t write the offer after months of looking are either overly cautious (afraid of overpaying, usually) and unrealistic about market values (often wanting something for 10-20% than it’s worth in the current market), although sometimes it’s another issue entirely, such as husband and wife not agreeing on either the priorities or the budget.
If you’ve been looking at homes for more than a couple of months, or have seen more than 20 homes and not found yourself able to write a purchase contract with your Realtor, it’s time to evaluate the process and what the stumbling blocks might be. Are you hoping to find a perfect house at a perfect price in the perfect location?
Waiting for perfect….
This situation of “waiting for the right house to come on the market” is not so unlike the seller of the overpriced house waiting for “the right buyer to come along”. If all of the other home buyers have seen and rejected that listing, it’s not very likely that another home buyer will come along and decide it’s just perfect or that the price is right. We speak of the “probable buyer’s value” and try to determine what the odds are that a buyer will pay what the seller expects. For a sale to happen, the buyer and seller expectations have to line up. So too for home buyers – if you have seen everything over many months, it is extremely unlikely that any new listings will fill the bill any better.
How your Realtor can help
If you find yourself unsuccessful in home buying and it’s been a few months, and you’ve seen plenty of properties, talk with your Realtor. It is very difficult to be objective about oneself and where one might be on the spectrum. If you’ve hired a good real estate agent or Realtor whom you trust and who is presenting you with homes to see that match your basic list, ask him or her what the issue seems to be and what needs to happen for you to be a successful home buyer. Please be open to hearing what your realty professional has to say and suggestions being made.
Over the last few years, I’ve helped many San Jose area renters to become home buyers. Sometimes they did have to write a few contracts before being able to buy (if there were multiple offers it can be very challenging!). Sometimes they had to change their expectations, order of priorities, location or budget for it to work for them.
If you really want to buy – and not just look – now’s a great time. Interest rates are fantastic. In many areas of Santa Clara County it’s a buyer’s market. If you can line up your expectations with the market realities of today, you can be a homeowner too.
For further reading: