SACRAMENTO—First time home buyers are facing some tough competition. Investors.
Marc Yap of Sacramento is looking for his first home. He says, "My rent is close to what my mortgage would be." His realtor, though, says it's difficult for people like Yap right now because investors are buying low priced properties and paying cash. Cash makes the process a lot easier for the seller.
"You really can't low ball an offer anymore. You really have to go at asking price and in many cases over asking price. If it's a good house in a good location and it's priced extremely well, you can expect to have multiple offers which could include investors with cash," says Cook Realtor Anthony Carrillo.
He explains that investors are fixing up these properties and renting them out. They often get a profit off the rent. If they buy a higher priced property and are taking a loss on the rent, they can usually afford to absorb the cost and will still make a profit when the market turns around.
So first time buyers have to be tough. Yap says he won't stop looking until he has the keys to his new home.