Pending taking backups. For someone shopping for a home, these 3 words can either be a source of relief/excitement, or they can be a source of disappointment. For those unfamiliar this means that the seller of a house has accepted an offer from a potential buyer and the two parties have entered into contract for an "option period". The potential buyer basically pays a security deposit to lock themselves in and get all their ducks in a row for the purchase, and the seller has the freedom to take backup offers in the event that the original offer falls through. Given how hot the market is around here right now, it's pretty unlikely the buyer will back out.
Now that Elijah is 15 months old and we're getting the hang of this whole parenting thing, the idea of having another child is starting to sound pretty appealing. Having a house (or in our case, a secondhand house!) that can support a growing family is something we have been discussing, and we considered ourselves to be "casual shoppers".
On Saturday morning we received the daily email with newly listed houses in the area, and one of those houses caught our eye. We went back and forth about going to see it, and 6 hours later we bit the bullet and called up our realtor to arrange a walk-through the next day. Just 6 hours after we set up the appointment, however, the house was under contract with a potential buyer. We still kept our appointment, but the entire walk-through was filled with disappointment - not disappointment that we had lost the house of our dreams, just disappointment that we didn't even have the chance to make a decision. A home is the most expensive purchase that many people make in their lives, and in just 12 hours this home was off the market.
We learned a pretty valuable lesson this past weekend: In the housing market, and in particular the housing market in Austin, there is no such thing as a "casual shopper". When you're "ready" to buy a house, you have to be prepared to buy a house. There are 3 big ways, among many others, that you can prepare to buy a house:
- If you aren't lucky enough that you can "make it rain" to pay for that house, get a pre-qualification letter from a lender. This makes you legit to a seller, and many sellers won't even consider you unless you have one.
- Know your spending limit and have the discipline to stick to it. If you're taking out a loan, you're placing financial risk on your future self, likely for 15-30 years. It's going to be hard to enjoy the home you're living in if you spend too much and constantly worry about how to pay for it.
- Be willing to pounce on an opportunity if it comes up. In a competitive housing market, this has to be a buyer's behavior. Identify the top wants/needs, and if those are satisfied within your budget, be ready to put an offer on the table.
In general we aren't in a rush to buy our next home because we are blessed to already have a roof over our heads. However, we know that there will be spikes of haste as the year progresses.
Pending taking backups. When you have an opportunity to buy the right home for your family, do you want to be a backup?