Question: How does a Realtor help a buyer determine their budget?
Answer: My role is to help my buyers stick to their budget and set realistic expectations to help them avoid buyer fatigue, especially in this strong seller’s market.
It is very common for homes in this market to sell well above list price, so it can be frustrating for buyers who look at (and sometimes fall in love with) properties listed near the top of their budget, only to be outbid.
My approach — and my advice to buyers who are doing their own searches — is to use the list price as a general guideline, but focus instead on recent comps for a true sense of what a property will sell for. If there is a good, comparable property that has sold for higher than their budget, it’s best not to waste time and emotional energy getting attached to a property they can’t afford. In the absence of a solid comp, a good rule of thumb is to only look at properties listed 10 percent below the max budget, leaving the buyer enough headroom to be competitive in a multiple offer situation.
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