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The coronavirus pandemic has brought out the competitive side in Laura Galeazzo as she searches for her forever home in Rochester, New York.
Galeazzo, a 33-year-old running coach at McKirdy Trained, an online coaching service for runners, has viewed a dozen houses and put offers on three of them, only to come up short as other buyers outbid her and her husband.
She fell in love with one of the first houses they bid on at an open house. The colonial-style, four-bedroom house with 2.5 baths was recently updated with a new roof, furnace and AC.
But an older couple in their 50s stood in front of the open house during the entire time so they could beat other families to the punch as soon as it ended.
“They stared people down to mark their territory,” Galeazzo said, adding that the older couple ended up getting the home when they offered $22,000 over the $234,000 asking price. “They even kept their car parked in the driveway so no one else could get in.”
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Since then, Galeazzo and her husband started driving by other homes in their price range to check out the neighborhoods. But then they noticed they had competition when they kept seeing the same people also drive by the homes they were viewing.
“My racing mentality kicked in. We need to beat them to the next house,” Galeazzo said. “It’s almost like you’re sizing up the competition for a bidding war. What if that five minutes it took to call your realtor made the difference?”
New homeowners face obstacles getting a mortgage without a bigger down payment and higher credit scores since lending standards have tightened in the aftermath of the pandemic. Lenders want to ensure that borrowers can still make their mortgage payments during the crisis following a historic wave of layoffs.
Although mortgage rates hover at historic lows, potential buyers are battling low housing inventory and higher prices, an issue that has plagued house-hunters in recent years and is showing no signs of letting up. Homebuyers must act quickly when debating a purchase, sometimes offering over asking price or getting into a bidding war with other potential buyers.
Low inventory was an issue before the pandemic. Homebuilders that were pummeled by the housing crisis still haven’t returned to a normal production levels to meet current demand. Now the supply shortage is weighing on the housing market even further with increased competition.