Beyond the mulched flower beds and staged living rooms, it’s not a pretty scene: increasingly desperate buyers striking out on offer after offer and would-be sellers afraid to list their homes for fear they won’t be able to buy one themselves. With buyer demand dwarfing the inventory of homes for sale, the spring 2021 real estate market is already a heartbreaker.
We asked realtors, lenders, appraisers, home inspectors, stagers, and movers for tips on how to navigate this season’s housing hysteria.
The bigger the down payment, the better. Prices are rising so fast in this market that appraisals sometimes fall short of the agreed-upon price, and banks generally won’t lend beyond that limit — which is one reason sellers like to see a large down payment that can cover the difference. “If there are five offers on the table, one of those people is going to have a suitcase of money,’’ said Kevin Fruh, owner/broker at Fruh Realty in Newburyport. “So you better put up your best down payment possible, and you potentially may have to waive the appraisal to compete with cash.’’
Look at homes below your budget so you can make a stronger offer. “When the market is this competitive, it can feel like the odds are stacked against you,’’ said Daryl Fairweather, chief economist at Redfin. “But you do have control over your odds when it comes to how strong an offer you want to make. And if you can’t make a strong offer at your current price point, you can make a really strong offer at a lower price point.’’
Don’t write a love letter to the seller. “These can fall into a whole other problem,’’ said Melvin A. Vieira Jr., realtor at RE/Max Destiny in Jamaica Plain. “Don’t write about loving the neighborhood, about your child — that can raise fair housing red flags.’’
Find out the seller’s needs. Ask as many questions as the other agent is willing to answer, Vieira said. “The key to a good offer is to build a relationship with the person across the table from you. … What’s going on so we can accommodate them to make this deal work?’’
Make yourself flexible. With such limited inventory, sellers can have a hard time finding a place to buy as well. If you’re flexible with your closing timeline because you can stay with family or in a short-term rental, you might have an edge over buyers who are up against their own pending home sale or an expiring lease. “People who have the ability to buy without selling first are obviously in the best position,’’ said Josh Lioce, a realtor with Lioce Properties Group in Milford. You could also offer a rent-back arrangement in which the sellers rent the home from you for a few weeks after closing until they’re able to close on their next home.
Don’t ignore homes that have been on the market for a while. Stagnant listings can acquire a stigma, but they’re still worth looking at, said Eain Williams, a realtor with Compass in Boston. “It might be the right home for you, and then you’re in a less competitive situation because other people are thinking: ‘Well, I’m not even going to go to see it. There must be something wrong with it because it’s been on the market for 30 days.’ ”
Use a local agent who’s connected to your chosen community. An agent who’s deeply in tune with the community will have an inside track on pre-market listings and name recognition among seller’s agents. Vieira includes a cover sheet with his offers identifying the team of local partners involved, including the lender and the attorney, and how best to reach them.
Be ready to go all-in for the perfect match. Moriah Wicker, a realtor with Keller Williams Colonial Partners in Plymouth, asks her buyers to rate a potential home on a scale of 1 to 10. “And if you say a 10, my advice to you is going to sound like I’m working for the seller because you have to go all-in,’’ she said. “Think about what contingencies can you waive, how deep in your pocket you’re willing to go. If you were to find out that you missed out by $10,000, would you be upset? And if so, then offer $10,000 more.’’
If you do waive contingencies, understand what you’re getting into. “There really has to be an education and comfort level there,’’ said Diane B. Sullivan, a realtor with Coldwell Banker Realty in Framingham. “I don’t say you can’t do it, but you have to be 350 percent sure.’’
Consider any other unique advantages you may have. Cash isn’t the only thing that can sweeten an offer. “Does your dad own a landscaping company where you can offer free landscaping on the seller’s new home for a year?’’ Wicker said. “What can you bring to the table?’’
THE MORTGAGE AND APPRAISAL
Get truly preapproved, not prequalified. Buyers trying to compete with cash offers should aim to be fully preapproved, meaning an underwriter has already reviewed your tax documents and other financial information and approved you for a mortgage up to a certain threshold. “The less you’re putting down, the more vital it is to have a preunderwritten loan and get preapproved,’’ said Deirdri Reddington, originating branch manager at CrossCountry Mortgage in Burlington.
Choose a responsive lender. “People should really make sure that their lender is answering the phone on a Sunday,’’ Reddington said. She recently had clients in a 15-offer situation, she said, “and the realtor said to me, ‘If I call up a lender to check on a preapproval letter and they don’t answer, I move on to the next offer.’ … So you want to make sure your lender answers the phone and is helping you to keep the deal together.’’
Make sure your lender works with local appraisers. With appraised values lagging prices, “You really need an appraiser who knows the market,’’ Reddington said, and is in tune with how fast prices are rising. Ask prospective lenders whether they use local appraisers and whether they’ve been having issues with appraisals coming back lower than the contract price.
Ask your realtor or appraiser to recommend a good lender. “In every field, including mine, there’s a 20 percent chance of an idiot handling your transaction,’’ said Adam Weiner, owner of Aladdin Appraisal in Boston, so ask an experienced home pro whom they trust. “We know the good ones.’’
If the appraisal comes in below the contract price, pay the difference if you can. “Seal the deal and overpay for the house,’’ Weiner said. “Here’s the mind-set: ‘I’m willing to pay the future value to get this house today.’’
Work with a local bank. “In brisk markets, it helps to work with known-entity banks that local people know or that have a local presence,’’ said Mary Gillach, a realtor with William Raveis in Chestnut Hill. Giant banks, meanwhile, are often too slow in fast-paced markets. “They’re awesome at online banking. They’re awesome at ATMs. They are pathetic at loan processing.’’
Avoid opening new lines of credit during the mortgage process. Applying for new credit can cause a short-term dip in your credit score — and you don’t want anything to throw your mortgage out of balance. “While you may want to finance new furniture or purchase a car, it’s recommended that you wait until your home purchase is finalized,’’ said Jason Sorochinsky, vice president of mortgage lending at Digital Federal Credit Union in Marlborough.
Lock in your interest rate early. “The shorter the rate lock, the better the interest rate, so sometimes people want to try to wait to get to 45 days to see if they can squeeze out a little better rate,’’ Reddington said. “But I’m advising against that. I think you just should lock at the time of application and move on.’’
THE HOME INSPECTION
Use all your senses. “A musty basement odor can mean mold, either visible or hidden, and it’s an indicator of a wet basement,’’ said Harold Popp, owner of Mt. Vernon Inspection Associates in Middleton. “There are remedies, but it’s expensive to dry out a wet basement … it’ll cost you more money than you think.’’
First impressions matter. Popp said that, in his years of experience, well-kept houses are generally well maintained all over, and the inverse is true as well. “Look at the porch, and it’s pretty much going to tell you what the basement is going to look like,’’ he said. “If it’s a wreck out front, it’s probably a wreck out back and down in the basement and in the attic.’’
Pull the home’s “jacket.’’ Some inspectional services departments, including Boston’s, maintain online property records that include past building permits. A roof may look fine, but if the last roofing permit was pulled 25 years ago, Popp said, you’re probably going to need a new one soon. It’s possible that an owner replaced the roof more recently and didn’t pull a permit for it. “But that tells you something else,’’ he added, “that possibly the roof wasn’t done by a licensed contractor and maybe their work is subpar. And that’s true for any renovation in the home, whether it’s a kitchen or bathroom remodel or structural repairs in the basement.’’
Open and close the windows, even newer-looking vinyl ones. “They can be cheap windows put in 15 years ago that are no longer really working properly,’’ Popp said. “People think because they’re newer vinyl windows they’ll work great, and they don’t many times.’’
Even new construction and gut rehabs need an inspection. Use the inspection to create a punch list for the builder, said Liz Martin, a home inspector in Brookline. “I once inspected a gut rehab only to find the kitchen sink drain wasn’t installed,’’ Martin said. “I stood there chatting with my client, running the kitchen hot water, while water ran out from under the sink onto the floor.’’
Condo buyers need to evaluate the whole building. A condo buyer isn’t just purchasing a unit. “They’re buying a percentage of the entire property, so the condition of the property in its entirety is important,’’ Martin said.
Make sure you feel comfortable with your home inspector, and tag along on the inspection. “It is crucial buyers participate in this process with an open and inquisitive mind,’’ Martin said. And for first-time buyers, especially, “It’s an educational experience for the buyer to fully understand how the property works.’’
Unless you have buckets of money, don’t forgo a home inspection. Ask your real estate agent about other ways to make your offer more appealing that don’t put you at risk, Martin said. “For most people, it wouldn’t be a victory to have an offer accepted on a house riddled with expensive or dangerous problems you never noticed because you didn’t hire a home inspector.’’
STAGING AND SELLING
Evaluate your home through photos to gain objectivity. “Viewing the home through pictures allows the homeowner to take a step back and see the home from another perspective,’’ said Tiffany Arsenault, co-owner and lead stager at Buyer’s Desire Home Staging in Acton.
Maximize light and flow. “Natural light opens up a room,’’ said Jen Storo, owner of Stage to Sell in Boston, and unobstructed flow makes a space feel bigger. “Remove dark window shades, blinds, and draperies to let the sunshine in,’’ she said, and that goes for any obstacles or small items on the floor.
Less is more. “Strategically placed furniture and minimalist styling are your best staging tools,’’ Storo said. “Remember, you’re selling the space, not your stuff!’’
Always stage a vacant home. “Less’’ doesn’t mean “nothing’’ — staged properties show better than empty ones, Storo said. “They look better in photos, demonstrate how buyers will live in the home, and give purpose and value to empty spaces.’’
Remove visual distractions. “In photos, small things look like clutter,’’ Storo said, and family photos and personal items make it harder for buyers to imagine themselves in your home. So clear surfaces of everything except for a few large, decorative items.
Organize closets and cabinets. An overflowing closet suggests a dearth of storage space. “Demonstrate you have more space than you need by removing items from closet floors and editing contents by half or less,’’ Storo said, “leaving some shelves empty.’’
Hire a stager with proof of insurance and ownership of a dedicated warehouse of furnishings. “Be sure to ask if the stager is properly insured to work on your property,’’ Storo said.
Give bedrooms and bathrooms the “hotel’’ treatment. “Like a hotel, white bed linens and towels are fresh and welcoming, making it easy to imagine staying for the night — or forever,’’ Storo said.
Once you list, go away for the weekend. Buyer demand has been so relentless that a lot of sellers are overwhelmed by the sheer number of people coming into their homes, Williams said. So he tells sellers to skip town when their home first hits the market. “They can leave for the weekend and then do a COVID clean when they come home,’’ he said. “That way, they don’t see how many people come, and they’re not freaked out.’’
PACKING AND MOVING
Once you have your moving date, pack at least five boxes a day. Moving day sneaks up on a lot of people, said Kamaul Reid, owner of RARE Movers in Dorchester. “We’ll show up, and it’s almost as if they woke up that morning and said: ‘You know what we should do today? We should move!’ ’’ Reid said. “The house is in total chaos and disarray.’’
If friends recommend a moving company, request the same crew or team leader. Research and word of mouth are the best ways to find a reputable moving company, Reid said, but he also suggests getting the names of anyone who left a good impression on your friends or family members. Request them for your own move, he said.
Move midweek and midmonth to save money. “The twenty-third of the month to the fourth of the month is peak moving time, so everyone’s rates are higher because the demand is so intense,’’ Reid said. “If you move between Monday and Thursday before the twenty-second of the month, you’re guaranteed to get a better deal.’’
Book your move at least 30 days in advance. Reputable moving companies book up fast, Reid said, and “once they reach capacity, now you have to go to the next company, and they may not be as accommodating.’’
Ask your moving company whether they have old boxes you can pick up for free. “Most of the moving companies are inundated with used boxes and supplies that they can’t use anymore,’’ Reid said. When packing kitchen items, “newspaper is your best friend,’’ he added.
Let pros pack the fragile stuff. “Clients should pack all of the books, should pack all the pots and pans,’’ Reid said. But when it comes to breakables, “Let the movers do what the movers are trained to do, and pack those properly … a lot of people do not realize [that] once the client packs a box, the moving company is not responsible for the contents of that box.’’
See what your home insurance covers. Moving companies offer various tiers of insurance, but your homeowners policy may provide some coverage, too. “Contact your local agent if you have a homeowner’s insurance policy or renter’s policy,’’ Reid said.
Donate as you declutter. Items you don’t want to move but are still in good working order could help a worthy cause. “We are always most in need of clothing, as it’s our number one seller and [it is] easiest to recycle items that do not sell or that we are unable to give to families in need,’’ said Tim Raines, marketing and development director for the Salvation Army, which operates adult rehabilitation centers. “In addition to clothing, we accept shoes, accessories, household items and knickknacks, and furniture.’’ The Habitat ReStore also accepts furniture and home goods.
Drop off donations in bags or boxes, or schedule a pickup. Some charitable organizations will pick up your donations curbside. “Donors can find information on nearby dropoff locations, as well as arrange for free pickup by visiting satruck.org or by calling 800-SA-TRUCK,’’ Raines said.
Check donation guidelines. Different donation centers accept different items and may have restrictions about when, where, and how you can drop off things. Call or check their websites first to make sure you’re helping the charity, not creating problems. For example, the boxes of subway tile in your basement would be a good fit for the Reuse Center at Boston Building Resources, but not Goodwill or the Salvation Army. And in general, ripped or broken furniture, chemicals, medical supplies, baby gear (including cribs and car seats), and broken appliances should be thrown out, not donated.
Pack a “Donate Later’’ box. After you’ve decluttered and donated everything you’re sure about giving away, put any items that you’re having second thoughts about in a box labeled “Donate,’’ Arsenault said. “If you still haven’t thought about or needed anything out of the box after six months, drop it off at a donation center — without opening the box. If you didn’t need it in the last six months, chances are you don’t need it at all.’’
Make sure you get a confirmation call. “If the moving company you hired does not call you with a confirmation phone call a week prior, there’s something wrong,’’ Reid said. Many smaller companies tend to overextend themselves during the busy season, so make sure you’re still on their schedule. “Thirty percent of our business is from moving companies that didn’t show up on the day they were scheduled to do so.’’
Jon Gorey blogs about homes at HouseandHammer.com. Send comments to [email protected]. Follow him on Twitter at @jongorey. Subscribe to our free real estate newsletter at pages.email.bostonglobe.com/AddressSignUp.