The Home Buying Game In 2018

Unmistakable signs of spring: the weather is getting warmer, and the housing market is heating up.

Although warm weather is welcome, for some buyers the temperature is getting uncomfortable.

Average home prices on Long Island have been increasing during the past few years, just as the amount of available homes has been decreasing. The current inventory of homes on the market is the lowest it has been in five years. That equates to greater competition among buyers.

Adding to the discomfort for buyers is the fact that mortgage interest rates are rising. While they had been at historically low levels in recent years, and are still quite low, reports in the industry are that some buyers are feeling a “sense of urgency”.

Another part of this mix is perhaps a bit of unfortunate timing: As you may know, the federal government has decided to limit itemized income tax deductions for state and local taxes to $10,000. This includes property taxes. Many homeowners pay more than $10,000 in property taxes alone. However, exactly how this change will affect the bottom line remains to be seen. For example, the standard deduction has increased to $24,000 for a married couple. Many taxpayers will take that instead of itemizing. Also, the tax rates and brackets have become more favorable. The net result will vary depending on the taxpayer’s circumstances; some will benefit from the new tax laws. For others, this change should be considered in shopping for a home.

Of course, no one wants to miss out on that “perfect deal”. So, what to do?

First of all, be realistic. The perfect deal does not exist, and the perfect time to buy does not exist. If you are serious about buying, become as prepared as possible, and be flexible. Get pre-qualified by a reputable lender. Know how much mortgage debt you can afford. Factor in expected property taxes and homeowners’ insurance premiums. Understand what your likely income tax obligation will be. You will then know your price range for a purchase.

If you are ready, don’t delay. Make house hunting a priority. Interest rates likely will rise more, so this may be a good time to jump in. To have the advantage on the stiff competition, find a knowledgeable, enthusiastic real estate agent you can trust. Make his or her job easier by having that letter from a lender showing that you qualify for the loan you need. Get your own credit reports, so you don’t find an unpleasant surprise late in the process.

If you don’t have to sell a house or anything else in order to purchase, make sure the seller’s representative knows that. Your offer will be more attractive to a seller.

Finally, when you make an offer, be prepared to justify it. Even if you give a “low-ball” offer and expect to come up considerably in your price, many sellers will feel that you are wasting their time and will not even make a counter offer, especially in this, a sellers’ market.

You might find that you are in a “bidding war” where other buyers have offered more than the seller is asking. Whether what you are told about other offers is true can be a stressful guessing game. So you need to know the market as well as anyone. To be successful, you must do your homework.

If your offer is accepted, you need to know what to expect next. For step-by-step advice, read my article “How to Buy A Home” on my website at

Copyright 2018 Joseph A. Bollhofer, Esq.

Editor’s Note: Joseph A. Bollhofer is an attorney practicing law since 1985 in the areas of real estate, elder law, Medicaid and estate and business planning and administration. He is also the president of Downstate Title Agency, Inc. His legal advice has appeared several times in Newsday’s “Ask the Expert” column, a weekly feature dedicated to elder law and estate planning issues, and in Bar Association journals. He is a member of the National Academy of Elder Law Attorneys, and of the Elder Law and Surrogate’s Court Committees of the Suffolk County Bar Association, currently serves as chair of the SCBA’s Real Property Law Committee, and is a member of the Real Property, Elder Law and Trusts & Estates Law Sections of the New York State Bar Association. His office is located at 291 Lake Ave., St. James, NY. He can be reached at or 631-584-0100.