How Long Does It Take To Buy a House On Your Block
Buying a house isn't the same as going out to Starbucks to buy a cappuccino. Most deals take time to complete and finance, meaning you could be waiting longer than you'd like. But how long does it take to buy a house? Let's go over a few possible scenarios to give you an idea of your timeline.
Is it worth buying a house in today's seller-friendly market?
Experts like Forbes think so. Owning a home almost always cuts back on your living expenses and makes life easier. But even in today's accelerated market, expect a six-month average time frame for a home sale. Don't hold to six months as a steadfast rule, though! Some purchases could be as quick as 1-2 months.
On the flip side, some purchases may take you 12-18 months to complete! This broad time frame may frustrate many buyers but is often hard to control.
Ultimately, How Long Does It Take To Buy a House?
Anticipate at least three months to complete your home deal. If you run into complications, expect at least 12 months or more. And expect an average of around six months to seal the deal finally. Also, understand that many of these elements could be out of your control. Patience helps out when buying a home. And working with us can help you manage your home financing.
Home Buying Process
Let's break down the home buying process to help you understand these factors. First, we'll go over each step in-depth and give you a timeline for each element. We'll then give you some tips on how to speed up this process and avoid waiting too long.
Step One: Mortgage Preapproval
Get a mortgage preapproval before you start shopping for a home. This step helps to ensure that you have funding for your new house and minimizes any confusion. It gives the seller an idea of what you can afford. It should take no more than one week to finish this process. This process requires you to:
- Visit a lender and discuss the home deal you wish to make
- Give the lender financial information such as your income and tax statements
- Wait for the lender to check your debts and credit score
- Receive a letter from your lender indicating their loan offer
A preapproval letter estimates how much your lender is willing to offer you when buying a home. It is not a binding agreement or a legal contract. They haven't given you any money yet and won't until the sale finishes. Yet, a letter strengthens your offer and shows your seriousness.
And while waiting a week for this letter may be frustrating, it helps speed up your home deal. It not only shows the seller that you're serious but gives them an idea of your loan potential. As a result, they can decide whether to continue working with you or move on to another buyer.
We recommend that you use our app to make loan shopping easier. We gather financial information from lenders. And we then present it in a simple and easy-to-understand manner. In this way, your sale should be better. You might even speed up the buying process as well.
Step Two: Find a Home
Shopping for a home can be both fun and exhausting. It will be the longest part of the buying process. On average, homebuyers spend at least three months looking for a home. Yet, that doesn't mean you can't find a home quicker. Conversely, you may take much longer to find a home. Many factors affect how quickly you'll find a house.
Availability
How many houses are available in your neighborhood? If there aren't many, your search may take a lot longer. After all, real estate is a supply and demand market. When there's no supply, you cannot find a home. Availability also takes into account various other factors, including:
- The type of home you are seeking
- The price you can afford
- The quality of the home itself
- The location of the house
- The quality of the neighborhood
These factors need a careful understanding and firm grasp of their impact on home prices. For example, you might find a beautiful two-bedroom house in a questionable neighborhood. Or a house might fall in your price range but have many fixer-upper qualities.
Pro tip: Never rush into a home because it is available! Too many potential homeowners buy whatever they can to get a house. Don't rush this experience. Instead, take your time and examine each property. Work with a realtor to get the best results here.
Demand
Is your neighborhood in high demand for homebuyers? Or are buyers avoiding it like the plague? Demand often varies and can impact sale speeds. For instance, a low supply and high demand often cause houses to sell in a matter of days. Factors that influence demand include:
- Appealing nearby amenities, such as a high-quality school
- Neighborhood safety, including crime rates and police presence
- HOA or Home Owner Association fees and interest rates
- Availability of shopping destinations
- Proximity to unappealing elements, like high-voltage power lines
- Nearby highways or roads that may cause noise
- Industrial facilities with heavy smells or noise
- Road quality, including potholes and other issues
- Ease of sidewalk access
- Availability of various amenities
Unfortunately, there's no metric that measures a neighborhood's demand. Instead, real estate agents gauge these factors when deciding on a home's price. As a result, calculating these factors may be challenging. That's why it is so vital to work with an agent who can help you.
Red Flags With a Home
Every home possesses a few issues that may affect its quality. These red flags could slow your home sale by forcing negotiation and repairs. Typically, the homeowner must repair these problems unless otherwise agreed. A few of the most common issues in a home include:
- Poor wiring that could threaten a house with fire
- Light switch and outlet issues that could be dangerous
- Plumbing problems that may occur at any time
- Issues with carbon monoxide gas
- Lead paint throughout the home's structure
- Asbestos to remove before moving into a home
- Radon gas problem you must manage to avoid poisoning
- Structural damage that could threaten a home
- Gutter problems that may cause water leakage
- Roof damage that may spread
Should you buy a home with so many red flags? That depends on many factors. For example, you can use these red flags in negotiations to get a lower price. But you'll have to fix them up to make your home livable. It's a Catch-22 that requires a skillful assessment of your financial situation.
Step Three: Submit and Negotiate Your Offer
After finding a house, you must submit an offer to the seller. Then, you and your agent can create a proposal that feels right for you. If you're lucky, the seller will immediately agree. But, negotiation almost always occurs after you submit a deal. This process takes anywhere between 1-2 months. Yet, some people also deal with deals much faster or slower.
Factors that affect the offer include your downpayment, loan amount, and repairs. Sellers may try to increase the price after performing repairs or upgrades. Work with your agent to avoid endless confusion and frustration. This process usually follows a few different steps. Let's break them down below to give you an idea of what to expect when buying a home:
- You submit the first offer and wait for the seller to reply
- They look over the proposal and come to a decision
- They accept, reject, or make a counteroffer
- Acceptance means you can move on to the next steps
- Rejection requires you to submit a new offer or choose another home
- Counteroffers include a new price set up by the seller
- You examine the counteroffer and make a decision
- Accept the counteroffer and seal the deal
- Send another counteroffer to the seller
Even when sped up, this process can take months. The seller may use tactics like repeated rejections to force your hand. Or they may bring up other offers on the house to push you higher. Take a measured tone and avoid getting personal during negotiations. Calmly explain your points and present counteroffers as needed. Focus heavily on repairs and the red-flag issues we already discussed.
You're not likely to get the price you initially proposed to the seller. Yet, you'll probably also spend less than they want. Most deals fall within the middle range for both buyer and seller. That's why you must pitch low and wait for them to bring you higher.
That said, you want to avoid frustrating or even insulting the seller with a meager price. Thus, it's best to be reasonable and shoot for no less than $5-20K lower than the asking price. Work with your agent to come up with an excellent initial offer.
And use the house's and neighborhood's quality to argue for a lower price. For instance, if the house needs a lot of repairs, decrease your initial offer. You can then claim you'll fix the issues yourself. This type of approach often forces the seller to resolve the problems for you.
Understand, though, that you'll be adding days and weeks to your sale with each negotiation. As a result, each new deal will take days or up to a week to resolve. And at this point, you've spent at least 3-5 months on this deal.
But if you get through this negotiation process properly, few steps remain. First, you need to close the deal and then finish the financing. All told, those steps should take no more than a month. But, again, it may take less time if you work with an agent or an adaptable and friendly seller.
Step Four: Closing the Deal
Finishing up your deal will take at least one month, even if you've reached an agreement. This time limit is usually non-negotiable. Why? Most lenders will demand 30-45 days to finish up your loan. They'll also perform several steps that help to verify the value of a home. The lender doesn't want to overspend on a home. Thankfully, they'll take many steps to ensure you're protected.
Appraisal
Independent appraisals help to confirm the quality and value of your home. They inspect the home and give a fair market price. Your lender then uses this information to provide you with a loan. Appraisals take a few days to finish. Appraisal experts walk through the home and gauge issues like:
- Construction problems
- Utility issues
- Potential structural failure
- Exterior and interior damage
- General value based on these factors
While the initial appraisal takes no more than a few days, it may take longer to finish the evaluation. After it is over, work with your lender to find an agreement. You may need to adjust your downpayment or even your offer if the appraisal is lower than the asking price.
Underwriting
This process gives your lender an idea of your financial situation. Then, they check and verify your income, assets, and debts. They can then use this information to approve or deny your loan. Most of the time, you don't get involved with this process. However, they may ask you for more information to help verify your loan. This information includes:
- New sources of debt since you initially applied
- New sources of credit
- Changes in employment status
- Tax estimates or reports
In rare situations, you may get denied after the underwriting process. Unfortunately, this adds extra time to the deal and may cost you extra money. The seller may also move on to a new buyer if you cannot seal your loan quickly enough.
Home Inspection
Lastly, a home inspection gauges any problems that may need to be repaired in the home. Not all lenders ask for a home inspection before approving a loan. And spotting these issues will increase your approval time as well. Some home buyers skip this step just to get their homes more quickly.
That said, finding problems may change your agreement and decrease the amount of money you spend on the home. At this point, negotiations may begin again, increasing your sale time further. You're likely to walk away from this negotiation with a lower buying price.
Closing on the Loan
After going through the three steps above, you can finally close your loan. This process takes around one week. Your lender will send you a "Closing Disclosure" letter that goes over the final terms of your loan. It includes information like your interest rate and your closing costs payments.
Your lender must give you three days to read the disclosure. Then, they'll schedule a closing meeting. At this meeting, you'll sign your loan paperwork. You'll also pay your downpayments and closing costs. Once you've made these payments, you're now a homeowner!
Speeding Up This Process
So, how long does it take to buy a house if you speed up these steps? That all varies depending on your skills. You also need to find a great agent who works directly with you and the seller. Focus on streamlining these steps and preventing conflict between yourself and the seller.
Often, conflict occurs simply because the buyer is not prepared. Preparation helps you understand this process and avoids confusion and dispute. Thankfully, many steps exist to get you ready for a sale. Just a few that you need to consider include how you can:
- Know what you want with a home
- Understand your budget before buying
- Research the market to gauge its overall value
- Save up a good downpayment before you begin (around 20% of the home cost)
- Improve your credit to expand your loan possibilities
- Create many lines of communication for negotiation
- Work with a buying and selling agent
- Keep communication civil and counteroffers reasonable
Remember: you're negotiating a deal with someone, not making friends. However, you're also not looking to make enemies either. Look at your real estate deal as a business transaction and keep your emotions out of it. Nothing will slow down your purchasing process like infighting.
Also, don't forget that the seller wants to seal the deal as quickly as you. They want to move on with their lives and use the sale to fund new purchases. Keep this factor in mind and focus on appealing to everyone mutually. In this way, you can get the best results for your deal.
Buy, Sell, Rent - Join the Accury Store to Learn All about It.
Work With Us to Learn More
Our financial app helps streamline your home purchasing process. It presents many sources of financing information. As a result, you can shop for lending options by comparing prices, interest rates, and much more. Start by getting a member key at our store and then:
- Downloading our app in the appropriate store for your phone
- Registering yourself on the app to get started
- Providing your first name, last name, email, and password
- Selecting "Main Goals" on the app to begin your search
- You can set up many goals with our app to control all your financing information in the destination