The Biggest Challenges for Young Homebuyers in the Bay Area  

We know that buying a home can feel difficult, but that’s why we’re here to help you sort through your financial options. But what are the biggest challenges facing individuals who want to buy Bay Area homes in 2020? So many things can affect your ability to buy a home, both in and out of your control. Here are a few of the things experts have noticed in the market that could affect your experience.

Selling for More

You expect a real estate transaction go one way. You see a home you like, assess the asking price, make an offer based on various factors, and the buyer decides if that offer is fair. But in the Bay Area, that isn’t necessarily the way things work.

Homes are not on the market for long and sellers are not getting their asking price. They’re actually getting more than their asking price. Unlike other markets, it appears that asking prices in the Area are mere suggestions and in order to stay competitive, you need to outbid your competition. That’s keeping a lot of potential buyers out of the game altogether.

Money Talks

We know that not every buyer can make a cash offer, though a lot of homes are being sold in the Area this way. Money does talk and when you need to get financing to buy a home but other buyers can just spend cash over the asking price, how can you ever get ahead?

While money talks, there are other ways to get what you want. For example, putting more than 20% down on the home may get a seller’s attention. You can also think outside the box completely and look into alternative real estate options, such as foreclosures or even homes that aren’t on the market but might consider for the right circumstance.

Contingencies

In most of the county you can expect to return during the offer process with a list of contingencies. For instance, the home may need a new roof so you ask that it’s either replaced before you buy or the money for the roof is taken from the price. There have been situations in the Bay Area where sellers are not even allowing inspections and many buyers are going along with it.

It’s okay to be flexible, but don’t do it at the cost of your peace of mind. If you want to buy a home but have some concerns about what the inspection will find, don’t just let the seller walk all over you. Even if they refuse to sell, it may still be best to walk away. That can be hard when you feel like there will be limited options. But it’s better to keep looking than buy a home that absolutely won’t work for you.

Pre-Approval

Throughout the entire homebuying process, make sure that you’re partnering with an independent mortgage lender like GoPrime of California. All across the country, we recommend that buyers get fully pre-approved before beginning the house search, but that has never been more imperative than in the busy Bay Area market.

We have seen so much heartbreakand challenges when someone finds a home that they absolutely love but can’t manage to make the financials work. It really is a cart before the horse situation. Instead, get everything in place before you start looking for your California home so you know exactly the budget you’re working with. It will also speed up the buying process since the seller knows they don’t have to wait for you to get a mortgage.

Debt

One thing we’re seeing over and over again in the Bay Area, and across the country, is the impact of student loans on the ability to buy homes. Back in July we wrote this post about buying a home in California when you have student debt.

While there are a lot of things you can do to prepare, we encourage buyers to improve their credit scores, decrease their debt to income ratio, get preapproved for a mortgage, and work with an independent mortgage lender to determine if some alternative home loans would be a better fit for your specific situation.

Expanding Your Search

We know that you may have your heart set on a specific neighborhood or area, but what if those don’t quite pan out. It can be helpful to consider other areas based on your budget and lifestyle needs. Before you get too invested in just one narrow band of the region, research other areas.

Of course, we know that throughout the San Francisco area there are multiple things to consider. You may need to think about the proximity to your job and access to public transportation or traffic patterns. You may want to look at schools or community resources. Take time to consider all of the possible locations before you settle on just one.

Preparing for Disappointment

Of course, no matter how well you plan ahead there will be instances of challenges and disappointment that you can’t avoid. You may lose out on that home you love so much to another buyer. Or you may find that you can’t afford the location you want to live in the most. These can be stumbling blocks, but they don’t have to derail everything.

If you prepare for disappointment ahead of time, you may be better equipped to roll with the punches as they come. You’ll know that it won’t always be cupcakes and unicorns and you can take a beat to breathe through it and then dust yourself off and keep looking. That’s why we recommend you have a great team around your home search starting with an independent mortgage lender and a great realtor who understands the area.

We don’t want you to face disappointment or challenges in your California home search, so call Zachery Adam and GoPrime of California today.

Contact the team at GoPrime Mortgage of California to learn more about buying your next home in the Bay Area. Contact Zachery Adam and the team at GoPrime.