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Can’t Find a House to Buy? Here’s What to Do, From a Lender’s Perspective

Can’t Find a House to Buy? Here’s What to Do, From a Lender’s Perspective
mike kadair headshot Contributor

Have you been preapproved for a mortgage but can’t find a house to buy? You’re not alone. The housing crunch has left many homebuyers frustrated and in the market for much longer than they ever intended.

I know because as a mortgage sales manager, my team and I work with qualified homebuyers all the time who are preapproved and ready to move as soon as they can get an offer accepted. The trouble is, there are precious few houses available, and the competition for them is steep.

But I’m going to tell you what we tell our homebuyers: do not give up. Owning a home is one of the best investments you can make in yourself and your financial future.

If you can’t find a house to buy, I’m going to give you a mortgage lender’s view of what you need to do.

What's in this Article?

Tip #1: Make sure you’re working with the right team
Tip #2: Keep your information current
Tip #3: Find a new agent or lender if you need to
Why are houses selling so fast?
Should I buy a house in this market?
Frequently asked questions

3 Tips for what to do if you can’t find a house to buy

Tip #1: Make sure you’re working with the right team

To compete in today’s market, you need to work with the right team. That includes your real estate agent and your mortgage lender.

Let your agent know your Plan B, C and D

Your agent needs to know what you really want, and where you can be flexible. Then they need to go out and find a house for you to buy.

Are they constantly scouring the Multiple Listing Service (MLS) database for new properties as they hit the market? Are they in touch often, or do weeks go by when you don’t hear from them?

In an aggressive market, you need an aggressive agent who proactively connects with you and is always searching out potential homes.

But, you need to meet them halfway. Your agent should know your Plan A and your Plan B – and maybe even Plans C and D.

Plan A is, we want to be in this school district, with this number of square feet, and these amenities. And if Plan A works out, great.

But for many homebuyers right now, Plan A isn’t an option. So talk to your real estate agent about Plan B.

That might include a home in another school district that is also good. Maybe it’s a split-level instead of a two-story, or maybe it’s slightly smaller than you originally planned. Maybe it’s even an older house that suits your needs but would benefit from a little renovating.

In an aggressive market, you need an aggressive agent who proactively connects with you and is always searching out potential homes.

Your real estate agent should know the full spectrum of scenarios that will work for you so they can send you any and all listings that might be a fit.

And if your must-haves change based on your market, or if you decide to compromise on things that were previously non-negotiable, tell them. The more information you can provide, the better a chance they have at finding you a great home.

It’s also key that you work with an agent who knows the area well. Someone who is really tuned into the local market may hear about houses before they’re listed, or they may know about a great property that was under contract but is now available again.

Time is of the essence when you’re buying today, so work with an agent who has deep local connections that can give you an edge.

Related reading: 4 Simple Ways to Find a Brilliant Agent on Real Estate TikTok

Only work with a purchase-first lender

I recently wrote about the importance of working with a purchase-first lender in today’s market. Purchase-first lenders specialize in helping clients buy homes, as opposed to helping homeowners refinance their existing mortgages.

An experienced, purchase-first lender will give it to you straight about the housing market. They’ll understand the challenges homebuyers are facing, and they won’t sugarcoat how competitive it is. But they’ll also tell you to stay in the hunt, and how to stay ready when you do find a house.

Ask your loan officer what they are doing to help you. Are they checking in to make sure they have updated bank statements and income records so you can move quickly when you want to make an offer? Will they contact the listing agent on a property to vouch for you and let them know you’re a qualified buyer?

A good loan officer will have a strategy and will be in touch often to see you through your purchase.

Related reading: The #1 Question You Should Ask When Choosing a Mortgage Lender

Tip #2: Keep your information current

If you were preapproved several months ago, send your lender updated bank statements and any information about a change in income or employment.

Changes to your finances can affect your preapproval amount, so communicate with your loan officer early and often.

Sending updated bank statements will help keep your file current so there are no unnecessary delays when you find a house to buy.

Tip #3: Find a new agent or lender if you need to

If you’re unhappy with your agent or lender, or you don’t feel supported by them, it’s OK to work with someone else. In fact, it’s in your interest to do so.

There’s nothing wrong with contacting a different lender, sending them your initial preapproval letter, and asking whether they can match it or otherwise help you.

If you’ve signed a buyer’s agent agreement with your real estate agent, check the terms of the contract. These typically have a set amount of time during which you’ve committed to working with this particular agent, so see how much longer that’s in place.

If you like your agent but are concerned about whether they’re being proactive enough in their search for you, talk to them about it. See if they’re willing to strategize on how to find more listings for you, and ask about their process. It may be that you just need to communicate more with one another. Or, you may want to look for another agent once your contract ends.

The important thing is that you feel confident in your homebuying team and that you know they have a plan for helping you buy a house.

Why are houses selling so fast?

Demand for houses has been sky-high since 2020, when interest rates plunged during the coronavirus pandemic.

Homebuyers wanted to take advantage of low rates, and many suddenly had the freedom to live wherever they wanted due to remote work. Without the constraint of having to be in a particular city or metropolitan area, many decided to move and buy homes, flooding the market with prospective buyers.

At the same time, many homeowners opted to refinance their mortgages rather than sell. They, too, took advantage of low interest rates and were able to reduce their monthly payments by refinancing rather than selling and moving into less expensive homes.

Those who did choose to sell exacerbated the housing crunch because after they sold, they also joined the homebuying market. Some sellers, flush with cash from selling their homes at top dollar were able to outbid first-time homebuyers who could not compete.

In short, this is a problem of supply and demand. The supply of houses in the U.S. has been short for the past two years, while the demand has been overwhelming.

Additionally, investors have bought up many properties to flip or rent, further squeezing the number of homes available to first-time buyers.

Should I buy a house in this market?

If you’re preapproved and are financially ready to buy a home, yes, you should buy a house in this market. There’s no doubt that the market is tough, especially in areas with low housing inventory (the number of homes available for sale).

However, buying now gives you the option of locking in a low interest rate with a fixed-rate mortgage.

Experts always expected interest rates to increase from the historic lows of 2020 and 2021. But inflation has driven rates up faster than expected, so locking in a home now if you can is a smart move. Rates are already near 4% in some instances, which is a great rate by historical standards but certainly higher than what we saw during the height of the coronavirus pandemic.

Assuming you’ve been preapproved and are ready to become a homeowner, now is the time to buy. Not only do you have a chance of getting a fairly low rate, you also give yourself the most options.

As interest rates rise, borrowers may be approved for lower loan amounts, because rates affect your debt-to-income ratio (DTI)**.

If you’re still not sure whether it’s a good time to buy a house, check out this explainer on why you should ignore the frightening housing headlines and become a homeowner this year.

The best thing you can do, though, is talk to a purchase-first lender who knows your local market. They can advise you on your homebuying options, and they can refer you to a solid real estate agent if you don’t have one or are unhappy with your current agent’s support.

Can’t Find a House to Buy FAQs

Why is it so hard to find a home to buy?

Low interest rates and remote work drove a lot of people into the real estate market during the coronavirus pandemic. Additionally, investors snapped up many properties to flip or rent. The demand for homes far outpaced available properties, leading to bidding wars and an inventory crunch that’s made it difficult for first-time homebuyers in particular to purchase homes.

Is it a good time to buy a house in 2022?

Real estate professionals say 2022 is a good year to buy a house, as interest rates are still low by historical standards. Housing prices are rising, so purchasing now will allow homebuyers to lock in relatively low rates and benefit from increasing home values.

*Pre-approval is based on a preliminary review of credit information provided to Fairway Independent Mortgage Corporation, which has not been reviewed by underwriting. If you have submitted verifying documentation, you have done so voluntarily. Final loan approval is subject to a full underwriting review of support documentation including, but not limited to, applicants’ creditworthiness, assets, income information, and a satisfactory appraisal. **Debt-to-income (DTI) ratio is monthly debt/expenses divided by gross monthly income.

Further Reading

Fairway Advantage Pre-Approval is the Key to a New Home

$15k First-time Homebuyer Tax Credit 2021: All Your Questions Answered