Buying a home is no easy task, especially in the nation’s capital.
Mortgage rates, though declining from recent highs in the last few months, continue to be a hurdle for some buyers, while limited inventory leaves fewer options for DC homebuyers to explore.
The District’s real estate market may seem intimidating to first-time buyers. But even with all these variables in play, some specific tips can significantly improve your chances of becoming a homeowner in Washington, DC.
Below, the team from Prevu Real Estate breaks down a few essential steps first-time buyers should take, from working with the right agent to finding a way to save money when they buy.
Get a mortgage pre-approval letter
You might as well not make an offer if you don’t have a pre-approval letter.
With the market in a competitive phase with limited inventory, sellers expect to see offers from serious and qualified buyers. Getting a mortgage pre-approval immediately puts you in that category, but the advantage is two-fold.
Getting a pre-approval letter shows the seller you are serious about buying, but it also helps you create a practical budget. Knowing the loan amount you qualify can be invaluable in designating a price range and property search.
Many first-time buyers go through an emotional journey when buying a home, and it’s easy to stray out of your budget if you find the perfect home. But sticking to a fixed budget with the guidance of your mortgage broker can be vital to preventing buyer’s remorse.
Hire an experienced buyer’s agent
If you boil it down, a successful home purchase typically rests on a stable budget, good negotiation skills, and thorough real estate market knowledge.
The budget is your responsibility, but an expert buyer’s agent can handle the rest. An experienced local real estate agent in D.C. can be a difference-maker in securing the best deal.
Whether you decide to work with one or not, it’s essential to remember the benefits that come with the former. Buyer agents come loaded with knowledge of the local market, such as price history, appreciation potential, and an extensive understanding of how to get around the best neighborhoods in Washington, DC.
They can help guide you to the best locale for your budget and handle complex paperwork that most first-time buyers may have trouble navigating.
But most importantly, they can be your key to saving money when buying a home.
Use commission rebates to save
Working with a professional buyer’s agent that offers commission rebates can make homebuying in DC more affordable.
When you interview potential real estate agents, ask them if they offer a buyer rebate. Commission rebates are simple tools that allow buyer brokers to pass on a portion of their agent commission back to the buyer as savings.
For example, Prevu Real Estate leverages its investment in salaried agents and a streamlined digital homebuying platform to offer the largest current commission rebate in Washington, D.C.
If you purchase a $1,400,000 home with Prevu in Dupont Circle, for instance, you could save up to 2% of the home sale price via the brokerage’s Smart Buyer Rebate. In this example, you could potentially receive a rebate check for $28,000 after closing.
This extra cash can help offset closing costs or serve as a furnishing budget for your new home.
Don’t wait to tour homes
A market that’s scarce in inventory is usually competitive. Therefore, most buyers determined to secure a DC home will be ready to offer when they find the perfect listing.
As a first-time buyer, you should be prepared to do the same. Work with your agent to set up effective property alerts so you’re on top of potential listings when they hit the market.
Buyers who work with Prevu gain access to a streamlined homebuying platform that allows them to customize their search and receive notifications once a matching home is listed for sale. The tool even provides buyers with a commission rebate estimate for every listing. Buyers can then schedule a property tour and communicate directly with their agent from the platform.
Acting quickly can potentially get you in front of the seller first, and if your offer is attractive enough, it just might be what the seller is looking for.
Be alert on properties with resale potential
Whether you plan on buying a forever home immediately or upgrading down the line, investing in a property with potential can make all the difference.
Your agent’s expertise will be crucial here, as they can access MLS listings and compare what kind of homes match your search criteria.
They’ll also be able to serve as your barometer if you happen upon a property that’s just outside your budget. Properties like that can be worth considering if you make an informed decision; not every historic home style in the District is worth the hefty price tag, and not every well-priced home is a steal.