Homebuyers grow irritated due to lack of supplyDate posted: 5/14/15 09:15:00 AM
Certain housing markets can be difficult to break into for first-time homebuyers. In San Francisco and New York, two high-priced cities, many young buyers can't afford to make a purchase and instead choose to rent.
In a market such as St. Louis, home values are climbing upward, but that's not what is keeping buyers on the sidelines. Potential homebuyers in St. Louis are growing frustrated with the housing market because there isn't enough available inventory to keep up with the demand.
"When properties come on the market, and they're priced right, for whatever condition they are in, they are selling very quickly￼," Jim Dohr, president of Coldwell Banker Gundaker, told St. Louis CBS-affiliate KMOX.
Dohr said a lack of inventory is starting to irritate buyers who fear they need to place an offer on the same day they see the property. If they don't, they risk missing out on the home because someone else is sure to snatch it up quickly.
According to Dohr, a major problem for the St. Louis market is that current homeowners who are willing to sell want a home already in place to move into prior to selling their current home.
"Because those houses, as I mention, get snapped up very quickly, or the inventory is as such they can't find something that they're interested in, which prevents them from listing their property," Dohr said. "So we have a little bit of a circular, chasing-your-tail kind of scenario right now."
The biggest boost the St. Louis housing market could receive would come from a growing number of homeowners deciding to list their homes on the market.
A better credit score leads to a better shot at obtaining a property
For Americans who live in such areas as St. Louis - where the home-buying process is cutthroat - there are ways to improve the chance of landing a property.
John Ulzheimer, president of consumer education at CreditSesame, told Bankrate one of the best steps a person can take to improve their chances of acquiring a mortgage loan starts with taking a look at their credit score.
"It's a brave, new world with respect to credit requirements for mortgages," Ulzheimer said.
The better credit score a person has, the easier it is for them to look attractive to lenders. Additionally, those with higher credit scores tend to find the best deals, while those with poor credit are prone to paying bigger fees or a higher down payment.
Vicki Bott, a former official for the U.S. Department of Housing and Urban Development, told Bankrate future homebuyers should do their best to keep their credit score above 660 if they hope to acquire a mortgage.
"While there are many qualified borrowers in the 580 range, the market today is probably (looking for) 640 to 660, at a minimum," Bott said.
Although a credit score between 700 and 720 is sure to help a person land solid rates, a credit score of 750 or higher will all but ensure a person obtains the best credit rates on the market. When a homebuyer's credit score dips below 680, that's when they will start dealing with worse rates and higher fees.
Buyers should improve their standing with lenders
First-time buyers and those looking to make a move-up purchase should examine their credit history to make sure they haven't been penalized for paid or settled debts.
Homebuyers should also try to put away money for maintenance and repairs. According to Joseph Gyourko, a real estate professor at the Wharton School of the University of Pennsylvania, homeowners typically spend up to three percent of a home's value on annual upkeep and repairs.
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