Image Credit: Saigonintela.vn
In 2023, despite a cooling housing market and high mortgage rates, turnkey homes are in high demand and selling fast. Unlike fixer-uppers and less appealing properties, turnkey homes situated in good school districts have become irresistible to buyers. In this article, we'll explore a report by Realtor.com that uncovers why turnkey homes for sale are still sought after, and we'll delve into the reasons why some homes sell quickly while others remain unsold.
Why are Turnkey Homes for Sale Selling Fast in 2023?
During the pandemic, homebuyers had limited choices, and everything sold for exorbitant prices. Those who couldn't afford to invest in fixer-uppers gravitated towards well-appointed, move-in ready homes. This trend has persisted into 2023, with buyers still seeking out turnkey properties.
Resale homes in good condition are in high demand, especially since home prices continue to be much higher than pre-pandemic levels. Buyers are now more inclined towards purchasing homes that are move-in ready, as they have little room in their budgets for costly repairs.
Competition for Turnkey Homes Remains Fierce
Competition for turnkey homes in desirable school districts remains fierce. If a house is perfect, chances are that someone else will want it too. In a market where costs are still high and buyers can afford to be selective, it's no wonder they zero in on the most appealing homes. Families, in particular, are eager to find move-in ready homes in good school districts, eliminating the need for any work or upgrades.
Why are Fixer-Uppers Less Appealing to Buyers?
While fixer-uppers have traditionally appealed to investors who could purchase them at a discount and resell them for profit, this trend has slowed down in 2023. With home prices falling from their peak, many investors are hitting the pause button on their purchases.
Fixer-uppers are remaining on the market for longer periods, and sellers are forced to lower the price or accept lowball offers. Buyers now only consider fixer-uppers when there is no other inventory available. Properties that remain unsold for more than 48 hours are likely to be located in less desirable areas and require significant improvements. Buyers are now seeking homes that have already undergone renovations.
Location and Price Still Matter
Properties in great locations can overcome major renovation needs or undesirable factors, such as being situated near a busy highway. Homes near train stations or in communities with top-rated schools are still highly desirable, and buyers can often get a discount on these properties.
Even the most rundown, abandoned homes located in the least desirable areas will still sell if the price is right. Price will always outweigh any objections buyers may have about a property.
How Should First-Time Homebuyers Bid for Turnkey Homes in 2023?
In today's housing market, first-time homebuyers face tough competition, particularly when seeking move-in ready homes in desirable communities with high mortgage rates. While the market has changed since the COVID-19 era, turnkey homes in great locations continue to receive multiple offers and sell at a premium. To increase your chances of securing your dream home, consider the following strategies recommended by Realtor.com:
Strategy 1: Know Your Local Market
Focus on your local market rather than national housing trends. Research the average time homes, including turnkey properties, are staying on the market in your desired community. Analyze comparable recent sales to make informed decisions. Consult with your real estate agent to determine if you need to waive contingencies and provide a higher down payment to have your offer accepted.
Strategy 2: Get Pre-Approved for a Mortgage
Getting pre-approved for a mortgage gives you a competitive edge in the housing market. It allows you to narrow down your price range and prevents losing your dream home to another pre-approved buyer.
Strategy 3: Find a Trustworthy Real Estate Agent
Choosing a reliable real estate agent is crucial. Seek recommendations from friends, check online reviews, and ensure they have experience working with buyers in a similar price range and the areas you're interested in.
Strategy 4: Make a Larger Down Payment
Sellers favor buyers who can make larger down payments as they see them as financially stable and more likely to complete the sale. Putting down at least 20% can increase your chances of winning bidding wars and eliminate the need for monthly private mortgage insurance payments.
Strategy 5: Offer Compelling Terms
Bidding wars aren't just about price; terms also play a significant role. Offering a flexible closing timeline, allowing sellers to rent back the home or vacate the property at their own pace, can improve your chances of winning the bid. You could also consider waiving a traditional home inspection and opt for an evaluation of the structural and engineering components, assuring the seller that you won't back out unless significant issues arise.
Should Investors Buy Turnkey Homes in 2023?
Investing in turnkey homes can be profitable in 2023 due to high demand and limited inventory. Buyers are actively seeking move-in ready properties, especially in good school districts. On the other hand, fixer-uppers are less appealing, and location and price remain crucial factors. If you're considering investing in turnkey homes, keep in mind that while they can provide a reliable source of rental income and require minimal renovation work, careful research and planning are necessary. Assess your financial situation, investment goals, and risk tolerance before proceeding.
In conclusion, despite a cooling housing market and high mortgage rates, turnkey homes for sale are still in demand in 2023. Buyers desire move-in ready homes without the need for additional work or upgrades. Location and price play significant roles, and homes in great locations, priced competitively, will always be sought after. To secure your dream turnkey home in a competitive market, follow the strategies mentioned above. If you're ready to begin your search for a turnkey home, reach out to us today. Our experienced team is here to guide you through the home-buying process and help you find the perfect home for your needs.
Source: Realtor.com, Realtor.com
