Buying your first home in a pandemic is a unique experience to say the least.
Even though many of the key strategies and principles to successfully buying your first home still apply, there are 3 tips you need to know before you buy your first home during COVID-19.
In this article, you will learn:
Prepare for your search
Goal setting
Boring, we know, but so important.
Goal setting helps you prioritize your true needs and lets your realtor know how to support you. For example, many first-time homebuyers will have vague goals like, “we want to be in our home by the end of the summer.” That’s a great start, but do you know how many steps you need to take to get there? Steps like speaking with a mortgage broker, hiring a realtor, viewing options in your desired areas, and identifying price ranges are key elements to finding your ideal property. Understand the full scope of completing your goals and clearly define what elements you are willing or unwilling to compromise will help you get your first home in a pandemic.
Consider some of the factors below when setting realistic goals:
- Current status of your local real estate market.
- Are you in a buyer’s market or a seller’s market? How competitive is the area? How long do the houses in that neighbourhood stay on the market?
- In this current climate, is mortgage financing slower, faster, easier, or more difficult due to COVID19?
- What factors are important to you as a buyer, and do sellers care to accommodate them? (example: house inspection)
- Will the health precautions in your area impact the pace of showings?
- Are realtors offering virtual or physical viewings? Can you do walk-throughs with masks? Are there time constraints? Are there a limited number of participants? Do you have to book in advance? Etc.
These are all important elements to consider when looking at your future home in a pandemic.
Quick definitions
Know Your Numbers and The Market
As a first-time buyer, there are three main figures you need to understand when preparing for your search: your budget, inventory, and price data.
Know your budget: Pre-approvals are a great starting point, and understanding your budget’s flexibility can help you build competitive offers. For example: if you’re looking at a house you really like but are advised that a good offer would be $10,000 more than your original offer amount, which equates to an extra $20 in your month-to-month financing (which isn’t as scary of a jump than you may have thought). Having the right numbers on hand is a great way to evaluate what houses are in play or out of reach. You can speak with your realtor, mortgage broker, or trusted financing contacts to clarify what avenues are right for you.
Know your inventory: Ask your realtor what the inventory is like for your target properties. Is it a seller’s market (low) or a buyer’s market (high)? Low inventory means that there aren’t many options available for your target properties, and you may have to compete with other buyers. High inventory means there are a surplus of homes and not much competition. This can set the tone for your strategy; to bid above or below asking, send pre-emptive offers or conditional offers, etc. Your strategy is relative to the market you are in.
Know your price data: Seeking out price data equates to market research when house hunting. You need to understand if you are looking at properties that will sell at, above, or below the asking price. Price data can help you shop purposefully and know how competitive your offers should be.
In short, knowing your numbers will help you prepare for your search, as this will improve your chances of seeing homes that fit your financing budget and will actually sell within a realistic price range!
How to take action
Time Management
This directly relates to how you are picking and booking the properties you want to view. To buy your first home in a pandemic, you need to view them physically. The best way to do this is to utilize the matrix portal used by realtors that list and search for homes for their buyers. This system will email you listings that fit your budget and criteria as soon as they hit the market. Viewing homes on your online portal quickly is important because it allows you to confirm if a listing is worthy of a view right away.
This is key because scheduling viewings while following COVID-19 protocol is tricky. Here is what is different from traditional house hunting:
- COVID-19 has caused more people to work from home and also given sellers fewer options to be out of the house during showings
- There is a limit to the number of people in a home at any given time
- There are fewer viewing slots available for buyers to see listings
- Realtors cannot share showing times with other realtors and their buyers
- There are little to no open houses during a pandemic
These factors limit availability for viewings, making a competitive market like Waterloo Region difficult to plan for evening and weekend slots- plan to move fast!
Leverage Technology
We can all agree that you did not dream of buying your first home in a pandemic but take a moment to appreciate the technology available to make this possible. Things like listing videos, virtual tours, and google maps are your best friend.
If a listing doesn’t have a video, it probably has a virtual tour. A virtual tour is different from a listing video because it allows you to gain a 360 degrees view of each room in the home. You can click through at your own pace, change angels, and view each room’s layout and measurements as you go. Virtual tours will also have a layout section so you can see an overview of the listing’s rooms on each level.
These tools help you identify if the home has the right condition, layout, and features for you. When it comes to location, utilizing google maps is key! You can check commute times to work (if you ever go back to NOT working from home), distances to main roads and highways, walking trails, and look at Google street view to get a feel for how well the neighborhood is maintained. Using these tools is worth the time investment as it will help you avoid viewing listings in person that aren’t a good fit.
Viewing homes in a pandemic
Even though fancy listing videos and virtual tours are still available, we highly recommend you actually view homes in person before you purchase your first property.
Crazy idea, right?
Below are some key changes to how we complete viewings when buying your first home in a pandemic:
- Masks are REQUIRED to enter any listings.
- Typically sellers only allow realtors to show their home to 2 people at the same time to limit the number of people in the home at any given time
- Sellers typically only allow 30-minute viewing spots at a time, whereas it was common to have 1 hr time slots for buyers to view properties
- Traditional open houses are not accessible, be prepared to make appointments and be on time
- Young children are not always allowed in some seller’s homes during the COVID-19 Pandemic
- Seller’s requesting that ONLY realtors touch anything in the home like doors and light switches
- Sanitize your hand before you enter and when you leave every viewing
These do not dramatically change how you view homes but do impact first-time buyers.
If you have children, you have to make arrangements for someone to watch them while you house shop. An alternative is to view each property, one at a time, with your realtor as the other stays with the kids. As first-time buyers, you probably have trusted friends or family members you want to consult with, which is totally normal. Unfortunately, with COVID-19 protocols, we cannot have many people viewing the property simultaneously. Using video chat or taking a video yourself as you walk through the home with your realtor can include others in your viewing experience.
All in all, our tips to you are to:
- set goals,
- know your numbers,
- practice time management,
- utilize online tools and resources, and finally,
- let your Realtor show the home with as little physical contact as possible.
