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There’s a housing boom nation wide, including in Washington State. In Duvall, WA Ben and Dani Graf looked great on paper as first-time homebuyers. However, “despite a healthy budget, free place to stay, and flexible time frame, first-time homebuyers [they] went $65,000 over budget on a house in need of serious renovation after months of striking out in the blazing Seattle metro area housing market” according to an article on home.com.

“In the back of our minds we know this house is hardly worth that much, but that’s where the market puts it,” Dani said. “The market in Duvall is crazy right now” said Real Estate Agent Matt Dubas, “We’ve seen some homebuyers that will make offers without seeing the property. They’ll take it no matter what and forego contingencies.” Buyers forego these contingencies in order to win bidding wars in this specific competitive housing market. 

Unprecedented home-buying conditions in 2021

The housing market in 2021 leaves Americans buying homes navigating unprecedented homebuying conditions that force buyers to make drastic compromises. Buying the Seattle metro area boasts a median 5.2 days on market and $742,000 sale price. The Graf’s didn’t want to move to a suburban area and wanted to remain in the metro area.

After an arduous search, the Grafs spent $565,000 on a house that clearly needed repairs and met too few of their requirements. “In the back of our minds we know this house is hardly worth that much, but that’s where the market puts it,” Dani said. “It felt like we didn’t want to offer that much, but felt like we had to.”

The renovation turned out much larger than expected, and four months after closing the family has yet to spend a night in their home. Despite the hardships, the Grafs are happy to be out of the housing market and consider themselves lucky for being able to buy at all. A comparable house nearby just sold for $630,000, which validates their purchase and even makes it look like a bargain.

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New framing wasn’t in the initial budget for these first-time homebuyers. Image courtesy of Home. com

“People need to be careful about buying homes that have non permitted renovation work,” says Dubas of Dubas Property Group. “When you’re on a search for your dream home, it’s easy enough to fall in love with any renovated features, such as a remodeled kitchen or bathroom, a finished basement, or a newly-installed deck, that are set to make your life more comfortable once you take over as the owner. However, those lovable features can easily turn into expensive nightmares when they turn out to be unpermitted work, and there’s no paper trail showing such improvements were done with proper authorizations.”

If its your dream home go ahead and buy

The extreme market conditions and the unwavering post-pandemic demand for housing nationwide and specifically in Washington State, will continue to require buyers to go all-in when buying a home. “If you’ve never bought a home before, you’ll likely want to take a look at the FHA Loan” said Loan Officer Ethan Wilson. “FHA Home loans can make it easier for you to qualify to purchase or refinance a home. This loan option offers flexible qualification guidelines to help people who may not qualify for a conventional mortgage.”

first time buyers concept on clipboard. 3d.

Benefits of an FHA home loan

FHA loans are widely used by first-time homebuyers and people with low-to-moderate incomes since this government-insured mortgage features:

  • Low down payments
  • Flexible income and credit requirements
  • Fixed- and adjustable-rate mortgages
  • Loans for 1-4 unit properties and condos may be available
  • Down payment funds can be a gift from a relative or employer*
  • Home sellers can contribute up to 6% of the closing costs

Ready to buy a home in Washington State? See if you qualify.

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