Real estate: Buyers come in many types

As with many Realtors, my buyers are asking me who the competition is lately. Is it investors, first-time homebuyers, second-home buyers, who?

The answer is: “Yes.”

Investors still are diligently seeking out deals from buying in bulk directly from the lenders to the individual one-offs. They are driving the market to a degree as they usually are willing to pay cash, close quickly and take the home in as-is condition meaning they won’t require any repairs be made prior to closing.

Second-home buyers are looking for vacation property they could possibly use to retire in the future. Some second-home buyers pay cash and some finance.

First-time homebuyers and buyers moving into larger homes are coming out of the woodwork lately with the low interest rates. The interest rate in October was month 3.6 percent on a 30-year, fixed-rate mortgage. In October of 2009 the interest rate was 5.41 percent on the same fixed-rate mortgage.

Today, the average payment on a $125,000 loan (without taxes, insurance and HOA) would be $570.06 versus $702.69 in 2009. This difference in payment, plus the lower prices on houses, is huge incentive for first-time homebuyers.

Without a doubt, there are more buyers in the marketplace today than in the past. The key to getting the home you want is to not think so much about the competition but to write up your initial offer to be the most attractive to the seller. Run the comps, figure out what the home is worth to you, ask for as few concessions as you’re comfortable with and submit the offer.

If you write up the most attractive offer the first time, you will never have to ask “what if” if another offer is chosen.