Columbus home prices continued to increase in August, while the inventory of homes for sale remained below normal, according to statistics by the Columbus Association of Realtors. The average Columbus home sale price was $194,879 in August, a 7.5% gain from August 2013.
The inventory of Central Ohio homes for sale is down 9.1% from a year ago. Until we see equilibrium between supply and demand, the pressure on home prices – and home buyers – will continue.
Please remember that real estate is very hyper-local. This means that home prices in a particular neighborhood, or even a particular price point in a specific school district, might be higher or lower than the broader market. Home prices can vary widely within a very small radius.
How are home buyers coping with higher prices? You might be surprised! A recent survey by BMO Harris revealed that 19% of home buyers are paying more to get what they want, rather than lowering their expectations. Of course, not all buyers are in a position to do this.
What’s more interesting, is that 20% of surveyed buyers didn’t follow a budget at all. This doesn’t mean they had deep pockets. Instead, they likely shopped by their maximum qualifying amount, without sweating the actual monthly payment.
On average, home buyers who went over-budget spent $31,587 more than they expected. Doing the math, that would add about $160.05 a month to a mortgage payment, assuming 4.5% interest on a 30-year loan.
While this isn’t a show-stopping amount, Columbus home buyers should be cautious about pushing their home buying budgets. Monthly home ownership costs can fluctuate, even if the principal and interest portion of your mortgage payment is fixed. And usually, these ancillary costs never go down in the long term – but rather continue to escalate due to a variety of factors.
Here are some of the moving targets to keep in mind:
- Property tax bills
- Homeowner’s insurance premiums
- Homeowner association dues
- Utility costs – these are often overlooked. Don’t ignore them!
- Maintenance costs of property and yard
- Maintenance of appliances and mechanical systems
Surprises do happen! Keeping control of your home buying budget is essential for long-term, successful home ownership.
Fortunately, you can defend your home buying budget by using an Exclusive buyer’s broker. Having professional representation on your side protects you in many ways; but first and foremost, we make sure you don’t pay more than you should! We provide you with market price comparisons, and we take condition issues into account. We negotiate on your behalf to secure the best possible sale price. Best of all, our service is free of charge to you!
As your Exclusive Buyer’s Broker, we serve your best interests at all times. Unlike real estate agents and brokerages who represent sellers, as an Exclusive Buyer’s Broker, we only represent you, the buyer, getting you the best price and terms with no conflict of interest at all times.
Understanding this distinction could literally save you thousands of dollars not only on the purchase price and terms, but also on seller concessions and home inspection issues, whether you are a first-time homebuyer or an experienced homeowner!
Contact us with your home buying questions! Remember, we are with you every step of the way…all the way home!
Andrew Show
Broker, CEBA, CEBA-M, CNE, CSP, ABR-M, e-PRO, GREEN
Buyer’s Resource Realty Services
Serving Metro Columbus, Ohio with Exclusive Buyer’s Agents
7100 North High Street, Suite 204, Worthington, Ohio 43085
614-888-4110 | 888-888-4110 Toll Free | 614-839-4110 Fax
