Should I buy a house even with higher interest rates?

The pandemic has pushed up real estate prices to unprecedented heights as more and more buyers seek to secure their properties. The trend has been particularly strong in beach towns and second home markets – with Rehoboth Beach, Del. being no exception.

The Blade spoke to five local real estate agents and asked for their advice on buying property amid a boom in the Rehoboth Beach real estate market.

Tip 1: Find a compatible real estate agent

The pandemic has been a time of widespread uncertainty. For buyers, that means it’s all the more important to keep up to date with real estate market conditions and property availability, as they can change every day, said Lee Group CEO Lee Ann Wilkinson. Ann Wilkinson from Berkshire. Hathaway Home Services Gallo Realty.

Russell Stucki, realtor at RE/MAX Realty Group Rehoboth, added that it helps to have a realtor with year-round experience in the area because they will be better informed about the market as a whole.

Once you have a realtor, it’s important to communicate what you want so they can approach the market with your interests in mind, Wilkinson added.

“That’s number one, find a really good real estate agent who can represent you and knows what you’re looking for,” she said. This way, when “the property becomes available, you are immediately notified and can compete with other buyers”.

Tip 2: Get pre-approved for a loan

In today’s real estate market, it’s important that buyers enter the process of finding a property prepared, said Chris Beagle, realtor at Compass Real Estate. For those who don’t pay cash, this includes getting a pre-approval letter up front that a lender is ready to provide you with the funds to complete a purchase.

“Too often people wait, then find a property and do it in reverse order,” preparing their financial paperwork afterwards, Beagle explained. In today’s market, “time is of the essence”.

“Be prepared to have very little to no contingencies in your contract, such as inspections and financing,” Wilkinson added. “It doesn’t mean you have to have the money to buy the house – it just means you have to be able to prove you can buy the house without relying on financing.”

Tip 3: Act quickly and decisively

With so many different people looking to buy properties in the Rehoboth Beach area, it’s important to make decisions as soon as possible, said Andrew Whitescarver, realtor at RE/MAX Realty Group Rehoboth.

“The best advice I can give to a buyer is this: if you see a house online that interests you, don’t wait until the weekend to come see it. The house will be gone,” he said. explained. Instead, “schedule a virtual tour” as soon as you can.

If you’re ready to make an offer on a certain property, “make a clean offer with an escalation clause” to keep it competitive with other buyers, Whitescarver added.

“This is not a sleeping market. You need to act quickly and decisively,” agreed Joe Sterner, realtor at Keller Williams Realty. “If you want something, you’re going to have to be a bit aggressive. This is not the market where you can bid… below list price.

While there may be some price negotiation wiggle room for properties that have been listed for more than 10 days, “you should expect to pay at least the list price” for recently listed homes.

Tip 4: keep your options open

With properties selling quickly, it’s important to be flexible with what you’re looking for if you’re buying on a budget, Wilkinson said. By “looking outside the box” you can “broaden your expectations so you have more properties that would work for you”, including those that didn’t sell immediately and can be purchased for a better price.

“It’s a seller’s market,” Stucki added, potentially making it harder to find an exact match because “we have limited inventory.”

“Look at these things that might not be what everyone else is looking at, and see how you can make them work for you” without getting caught up in specific “contingencies” that might make securing a property less realistic, suggested Wilkinson.

Tip 5: Don’t lose hope

While navigating such a heated market can be daunting, especially for first-time buyers, Beagle noted that it’s important to stay invested and focus on securing a property that works for you.

“It becomes frustrating for buyers…because a home purchase is an emotional process, and people become emotionally attached to a property and have hope,” he said. Despite the challenges, “it’s a learning process” that “inexperienced buyers have to go through” to get what they want, which requires a certain level of commitment, he explained.

While the future of Rehoboth Beach’s real estate market is uncertain, Stucki pointed to some changes the city has experienced during the pandemic that have proven beneficial.
“As far as the territory is concerned, we have grown and diversified. We’ve seen an influx of creative talent with all different varieties of activities, entertainment… (and) art,” he said. Going forward, Stucki expects Rehoboth Beach properties to “continue to maintain or exceed” their current values.

But Sterner added that while there is still a real estate boom, the market is “slowing down” some, which could help new buyers enter the market.

Beagle noted that this year is an election year for the state and that times of uncertainty like election seasons are not historically “market friendly.”

He added that he was unsure of the sustainability of the current market. “I don’t know if the industry could continue to sustain itself with the rapid increases in value that we’ve seen over the past two and a half years,” he said, predicting some level of “stabilization” in the market.

Beagle gave one final piece of advice: “If we haven’t learned anything else in the last few years, expect the unexpected.”

Comments are closed.