How To Protect Yourself From Panic Buying In A Hot Real Estate Market 

They say everything is bigger in Texas – well, that certainly extends to the demand for real estate, because the market in North Dallas is scorching hot! 

Buying a home is one of your most significant financial assets and investments. Despite all the intricate parts that go into this decision, more and more people are panicking with the lack of inventory on the market and rushing to pull the trigger. Homebuyers are taking advantage of what will almost certainly still be historically low mortgage interest rates. In doing so, we see this growing trend where prospective homebuyers rely strictly on FaceTime tours and listing photography to conduct their search and are panic buying a home.

Nobody wants to miss out on the action – but panic buying toilet paper is insanely different than panic buying a home. We’re here to help protect you from buyer’s remorse in an ultra-competitive market and to help you make an informed and confident decision. 

The Psychology Of Panic Buying During The Pandemic

Simply put, an overheated home buying market means there are more buyers than sellers. 

When demand outweighs the supply, competition ramps up, and that doesn’t mean an even playing field for buyers. We saw unusually panicked consumer purchases from the onset of the global health pandemic in March of 2020, and it quickly escalated to turning up the heat in the North Texas housing market. 

It triggered such a level of FOMO (Fear of Missing Out) in the housing market that homebuyers were putting in offers on homes sight unseen!! Take that in for a minute. There was such an emotional level of scarcity that buyers were willing to roll the dice on a home, waive the inspections, make a blind offer and essentially cross their fingers and hope that it all works out.

Over the last year, far too many homebuyers didn’t want to miss the window on these historically low rates. However, when gambling on a decision that could leave you house-poor,  or leave you with a house that has major issues or requires far too much upkeep- it pays to not get caught up in the hype. 

It’s normal to feel anxious about buying a home, but that doesn’t mean you can’t slow it all down to make an informed decision for your future. And it starts with working with your realtor to learn exactly what sort of environment we are in right now. 

3 Questions To Ask When Preparing For Low Housing Inventory 

1.     What is your budget range?

How much can you afford? Better yet, what do you want to spend? Say your goal is not to spend more than $450,000 on a home. Because the market is on fire and homes are going so high over the listing price, your search needs to be focused on properties no higher than $375,000. You need to have additional funds and liquidity to be able to make up a potential appraisal difference. Coming to the table pre-approved, with an exact number on what you can afford, taking into account closing costs, will ensure you don’t end up house poor, or get caught in a bidding war that can escalate fast.    

2.     What do we know about the neighborhood?

It can be risky not getting a feel for your new neighborhood. However, once we make sure it’s a perfect lifestyle fit, your realtor will execute their due diligence in the community by calling all agents who have properties already under contract. Finding out how many offers were made provides us with real-time data to make an informed decision on offer price and what it will take to win. 

3.     What are your non-negotiables?

It doesn’t matter if your budget is $200,000 or $2m; there will always be things that you have to take off your wishlist. We encourage you to focus on your three non-negotiables. And no matter what, these are three things that you cannot change. For example, if schools are essential, access to green space, or close proximity to work, make sure these are immovable pieces in your home search. You can always change the paint color or replace a countertop,  but you can’t move the house! Location, location, location is very accurate in real estate.

How To Sidestep Panic Homebuying In North Texas 

Take the emotion out of the equation 

Buying a home is an emotional roller coaster. You’re not just planning for now; you’re trying to see if this house fits your family’s lifestyle ten years from now! But emotions can sometimes commandeer your judgment and steer you in a costly direction. Managing your emotions is critical, especially in a multiple offer situation. That’s why unbiased realtors help provide clear and sound advice.  

Ask yourself – are you 100% in? 

If you found out tomorrow after that the final offer you put into that property went for a dollar more, would you be able to sleep at night? If you’re comfortable not getting into a bidding war because you know that house is not worth that amount – then you have protected yourself from a dangerous game.  

Remember, you won’t always win 

Not everybody wins all the time in real estate. So unless you’re prepared to keep upping the ante, it’s important to understand that you might have to take an ‘L’ sometimes and miss out on offers made. As your trusted realtor, Dallas North Group can provide our expertise on what is needed to win an offer – but at the end of the day, this is your home, it’s your money, and this is your decision. We will be there every step of the way offering our coaching and support regardless. 

Having the backing of a knowledgeable and trusted realtor walk you through this process will make all the difference in getting the right home at the right price for you. Transparency is vital in these situations, and establishing a relationship with your realtor built on trust will go a long way in removing any worry or hesitancy throughout this journey. 

 Dallas North Group is your local realtor that is always in your corner. Have a question? Get in touch today!