STOUGHTON, Mass. — Boston 25 News continues to talk about societal issues that impact our community in our “Gets Real” series. In May, the focus is on the housing crunch. LeRoy DeAndrade and Cristina Felicano are used to the housing crunch and they’re used to standing in line.
The Roxbury couple started shopping for their first home earlier this year and quickly learned how competitive the housing market is. At open houses, they’re often waiting in line with dozens of other prospective buyers.
“There’s more people buying than there are houses available,” DeAndrade said outside an open house in Stoughton last month. “If you’re not here early, you’re turned away.”
March 2021 marked a four-year high for the month of March in Massachusetts single-family home sales, according to The Warren Group, a Peabody-based real estate tracking company.
The median sale price for a single-family home in Massachusetts is $460,000, a 14.4% increase from March 2020, the company said in an Apr. 22 news release. There were 3,849 single-family home sales recorded in Massachusetts in March, a 2.5% increase from March 2020, the company said.
“Simply put, there just aren’t enough single-family homes in Massachusetts to buy,” Warren Group CEO Tim Warren said.
Throw in historically low-interest rates, and Boston realtor Mike Urban said home sales are going through the roof.
“For every seller, there’s five buyers, right? Or even more. That’s what the problem is,” Urban said.
In February, Urban posted advice for first-time homebuyers on Reddit after he said a Stoneham home sold for $57,000 above asking price.
“If you’re in the suburbs, you’re going to be competing with a lot of people who are looking to buy a house right now,” Urban said.
ASSEMBLE THE RIGHT TEAM
Before diving into the listings, Urban said first-time buyers should build a team of experienced professionals who work in “high volume.”
“A good lender, good realtor, and if you’re going to do inspections, a good inspector who knows what they’re doing,” Urban said.
“Knowing what to do when you’re going in will provide you with the best results so you don’t have to write 10 offers or you won’t have to settle on a neighborhood that you don’t like,” he said.
CONSIDER WAIVING INSPECTIONS
It sounds irresponsible, but Urban said a lot of buyers are waiving inspections to make their offers more attractive.
“If you find out everybody in the area is waiving inspections and you lost the last house you wrote an offer on because of inspections, it might be in your best interest,” Urban said.
Urban said you can consider waiving inspections of newer properties or if you trust an assessment from your realtor. You can also walk through the property with an inspector prior to writing an offer and conduct what’s known as a “pre-offer inspection.”
“ASKING PRICE” IS NOT “MARKET VALUE”
Many people think these two terms are interchangeable, but Urban said confusing the two can often prejudice the way you look at a house. The asking price does not always indicate how much a house is worth, he said.
In some cases, Urban said realtors are listing properties under fair market value, so a home listed at $600,000 may already be worth $640,000.
“If you determine a property is under fair market value based on the location and the square footage, the condition and the quality of construction, you can make a better-educated decision on whether or not going $50,000 or $75,000 above the list price is the right thing to do,” Urban said.
START LOOKING 3-5% BELOW YOUR BUDGET
Urban said this will help create wiggle room when you go to write your offer.
“You can’t start looking at the top of your budget, which most people do. You need to start below that so you can write a competitive offer,” Urban said.
Also, if you lose out on a house, check back to see what it sold for. This will help you learn the market and tell you how much you’ll need to stay competitive.