YES! It is a buyer's market! BUT what exactly does that mean? We met a young man today who qualified to purchase a $95,000 home with his VA loan benefit, but he wanted to look at $200,000 homes, because "it's a buyer's market and they will come down to the price he needs".
Can we talk? I certainly admire him for his knowledge of the real estate market news that's IN THE NEWS on the TV, in the magazines, and the subject of much agony in certain parts of the country.
BUT HERE's THE REAL STORY: Real estate is a local phenomena. Yes, that's right! Just because homes in Florida were purchased for $250,000 last year and are now selling for $160,000 does not mean that's going on here at Fort Hood. Heck, YEAH! That may be a fantastic "buyer's market" in Florida, but it doesn't translate dollar for dollar to real estate here in Central Texas.
When we say it's a buyer's market at Fort Hood, we mean we have MANY homes for sale and not very many buyers, and sellers are agreeing to pay all or most of your closing costs for you. They will go out of their way to do repairs on their homes that might not be done in a seller's market. But they will not (and usually can not)lower the price, or if they do, on average, it's only 1-2%.
Yes, you might hear of a rare bird of a property out there that was on the market for $180,000 and someone got it for $160,000. But after we look at all the information, we usually find out the home was VERY overpriced when it went on the market, and it ended up selling at fair market value, or perhaps just a bit below. The other area where you might see a big price reduction is in new construction homes that a builder needs to MOVE! (An experienced realtor can help you negotiate this!)
Another reason that it's rare to find a huge price reduction on a home is that most of our sellers purchased their home with a 100% VA loan just two to five years ago, and they may only have built a small equity in the house. These sellers are financially unable to give a buyer a large price reduction. They just won't have room to offer much price adjustment to a buyer because they must pay their own closing costs and pay off their loan with the sale proceeds.
So- What does this mean to a buyer coming into the market right now here in Killeen, Fort Hood, Copperas Cove and Harker Heights? It means that good buys are out there, but you should have a real estate professional on your side who knows how to analyze the market, point out good buys to you, structure an offer that is most beneficial to you, and who can show you how to get the most for your money in this buyer's market.
