It’s a tough time to buy a house right now. Even tougher for first-time homebuyers.
The white-hot real estate market in Tampa Bay has seen plenty of bidding wars, buyers waiving inspections and sales for tens of thousands over asking price in the last year.
Gene Vandi, 28, has been living in a rental home with a friend in Largo. But late last year, he started thinking about getting more space. Vandi, who works for a business lending company, began his house hunt around March.
In a perfect world, Vandi wants to buy a three-bedroom, two-bathroom home with a two-car garage and a backyard for under $300,000. But because of the current market conditions, he’s had to adjust some items on his wish list and bump his budget to up to $350,000.
Vandi spoke with the Tampa Bay Times about his house-buying experience. This interview has been edited for length and clarity.
I’m sure you have heard all the same things I have about how the market has been. Were you nervous starting this process?
I think everyone’s nervous when they go to purchase their first home, just because there’s a lot of unknowns and it’s the biggest financial commitment that you’re going to make to date. Aside from this, the biggest commitment I’ve made is a purchase of a car. So it’s something that you really want to make sure that you get right.
But like with anything else, you just have to start. You just have to start looking and start going to open houses, get a feel for what’s out there. Because the other thing that I realized is, early on, you don’t really know what you want, or what’s going to make you happy until you go to a few houses and you start seeing what your options are and what’s in your price range.
And has the market lived up to its reputation so far?
Oh, 100 percent.
I feel like I started looking when it was red hot. You’re going to these open houses and there’s multiple people there. You’re also doing this also in a time of COVID, so I remember a couple open houses where there’s a line out the door because they’re only letting one or two people in at a time. So you just kind of have to expect that and know that it’s going to be very competitive.
You go into these open houses and you’ll talk to the agents that are listing them and they’re like, ‘Yeah, we posted on Thursday. We already have three or four offers, and we’ll probably be accepting best by Sunday or Monday at 5 p.m.’ So it literally goes up, and it’s down within a week.
Like you said, this is such a huge financial commitment. What’s it like having to work under that kind of pressure?
It’s stressful. To be honest, it takes the joy out of it. I always envisioned that purchasing your first home is something that’s supposed to be exciting, something that you’re supposed to feel good about, get your own space. Yeah, it’s a financial commitment, but as long as you’re staying within your budget, you’re good.
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After a few months, I almost was getting a little frustrated and felt defeated in a sense because I think I put in two or three offers, and on almost every single one I was getting outbid by like, $20,000-plus over asking. It wasn’t even close. And I mean I’m going in with $5,000 or $10,000 over asking because I understand how competitive the market is.
So you almost just have to take it for what it is, and realize that it’s okay if you have to wait a little bit longer to find what you want. Because the last thing you want to do is rush into something, because you’re either in a very competitive situation or the timeline’s expedited, whatever it may be — and then you’re stuck with a home that in 12 or 18 months’ time could be less than what you paid for it.
Do you have a sense of how much you’ve been competing with cash offers?
Yeah, there are lots of cash offers out there. I think I was beat out on one or maybe two that were cash offers. You have these people coming in from out-of-state and the real estate down here, depending where they’re coming from, is much less expensive than what they’re used to, and they have these cash reserves. So they have no problem coming in and scooping these properties up with cash offers. When you’re in there with a conventional loan, it can be very tough to compete sometimes.
Being a first-time buyer, you can be at a disadvantage just when it comes to knowledge. What have you been doing to try to bridge that learning curve?
Looking at Zillow, looking at what’s popping up, when it’s popping up how long it’s staying on to get an idea of where the market’s at and how quickly things are going. That’s definitely helped.
In addition to that I lean on my Realtor. Mike (Thompson) has been great throughout this entire process, he’s very knowledgeable and we’ll walk through a house and he’ll say, ‘Due to the age of the house or the windows, here’s what you could expect for out-of-pocket expenses if you want to upgrade these things.’
What’s your outlook for the future?
I’m hopeful that it’s close. I know the absorption rate has been trending downward, which is a good thing. I’m hoping that with this eviction moratorium being lifted, even though it’s kind of back-and-forth in the courts ... (could lead to) more inventory on the market which will also kind of help stabilize things.
I’m hoping that I’ll be able to find something before the end of the year. But at the same token, at this point I’ve already waited six, eight months. So I’d rather wait another six, eight, even 12 if it means that I’m going to be more comfortable and get more bang for my dollar when I actually make the purchase.
What advice do you have for prospective buyers who are thinking about dipping their toes in?
My advice to those people would be, just know what you’re getting into. Do as much research as you can on the front end. And ultimately, you’ve got to be patient.
If you’re a first-time homebuyer and you are price-conscious, you’ve got to know that it might take you a solid six to 12 months before you find something in this market. You need to lean on your Realtor, who has that knowledge and is seeing how this market has operated over the last 12 to 18 months.
Ultimately, just understand that this is one of the craziest times to be buying a home in the last 15 years, so you just have to kind of roll with the punches.