Real Estate Buyer’s Guide for Shreveport-Bossier
You’ve been waiting and saving and considering your options, but you’re finally ready to buy your first home.
The good news is that you’re entering the housing market at the right time. In general, supply is catching up to demand, which means there are more homes on the market and more opportunities for you to find your dream house.
Of course, with states luring companies south with incentives and a lower cost of living, Southern homes are selling like hotcakes.
Here, we’re breaking down the Shreveport-Bossier real estate housing markets before giving you a comprehensive first-time real estate buyers guide.
The Bossier City Real Estate Market
The median listing price is hovering around $215k, with an average price of $116 per square foot.
It also has a low crime rate, with a median household income of around $48,523. The median age for residents is 35, with a majority of non-single residents and 25% of the population with a college education.
And if you have kids, Bossier City is a good place to send them to school. Most residents gave area schools an above average rating.
The Shreveport Real Estate Market
Then, there’s the Shreveport real estate market.
Shreveport is showing signs of growth despite weak unemployment numbers, which is good news for would-be residents.
It’s also a cheaper real estate market than Bossier City. The median home price is around $151k (well below the national average of $203,867). The average price per square foot is around $92, and there are more homes for sale than in Bossier.
In fact, Shreveport is one of the most affordable housing markets in the country.
It shouldn’t be too surprising, then, that the median household income is a bit lower than Bossier at $36,435. However, the median age is still around 36, 21% of the population is college educated, and the majority of the population is non-single residents.
That said, it does have a slightly higher crime rate than Bossier City, though the safety ranking is still high.
First-Time Shreveport-Bossier Real Estate Buyers Guide
With all of this in mind, let’s talk about the process of purchasing your first home.
It involves more than simply looking at home listings. To find the house that’s right for you and your family, you need to take the time to do your homework beforehand.
A Crash Course in Real Estate Terminology
Diving into the world of Shreveport-Bossier real estate can be a bit confusing. For first time homebuyers, let’s cover a few basic terms you’re likely to encounter.
First, an active vs active with contract (AWC) listing. An active listing means that the property is on the market and available for sale. It may have received offers but hasn’t accepted any of them yet.
An AWC listing means that the home has an accepted offer but the sellers are looking for additional offers in case the accepted offer falls through.
A contingent status means that the seller has accepted an offer and the home is under contract, but certain conditions (contingencies) must be met for the sale to be finalized.
There’s also the down payment, which is the lump sum of money you can afford to pay at the time of purchase. Typically, a down payment is 20% of the purchase price, and the rest is part of the mortgage.
Once you make a down payment, the remaining money you owe on your home is called the principal and is paid off under the terms of your mortgage agreement.
There are adjustable rate mortgages (ARMs) and fixed-rate mortgages (FRMs). In an ARM, you’re given an introductory interest rate for a period of 5, 10, or 15 years. After that period is up, the interest rate will change annually based on market trends.
Most people get a fixed-rate mortgage. In an FRM, the interest rate on the mortgage will never change, even if the term of your mortgage is 30 years. It’s almost always higher (initially) than ARMs, but the rate is predictable.
Are You Ready to Purchase Shreveport-Bossier Real Estate?
Now comes the first important question: are you actually ready to purchase a home?
It’s a bad idea to buy a house because all your friends are doing it or because your parents/grandparents/aunts/uncles/people you turn to for advice are telling you that you’re throwing away money on rent.
You also shouldn’t buy a home just because it’s a buyer’s market or because there are low mortgage rates available. You’ll be paying off that mortgage for the next 30 years of your life, and it may not be a buyer’s market by the time you find the house you want.
Instead, buy a home because you genuinely want to be a homeowner, or because you know you’re settling into an area and will likely be there for a while (at least the next five to ten years).
And above all, do not buy until you’re financially ready to do so.
Determine How You Will Buy (and How Much You Can Afford) Shreveport-Bossier Real Estate
If you are ready to buy a home, you need to determine two things:
- How you will buy your home
- How much house you can actually afford to buy
For most people, a house is the most expensive thing they will ever own. And most people don’t have savings accounts in the six-figure range waiting to use on a house.
That means that you’ll need a mortgage to buy a house, and a mortgage is nothing to be taken lightly.
Remember how we said that most down payments are only 20% of the home’s asking price? That means that 80% of the home’s value is tied up in a mortgage that you’ll be paying off for the next 30 years. So if you buy a $500,000 home, you’ll pay $100,000 up front and pay off the remaining $400,000 in installments.
Remember the Great Recession of 2008? It was caused by the subprime mortgage crisis in 2006, and the long-term result was a long list of foreclosures.
If you want to purchase Shreveport-Bossier real estate, you’ll need, among other things: a steady job, good credit, and a sizeable chunk of savings for the down payment.
Choosing Your Neighborhood
If you are ready to purchase Shreveport-Bossier real estate, it’s time to start looking. But you can make your search a lot easier if you know how to choose a neighborhood.
A good place to start is examining property taxes–it makes more of a difference than you might realize.
For example, you could afford a $300,000 home in an area with a 3.5% tax rate, or you could afford a $350,000 home in an area with a 2.5% tax rate while making the same monthly payment.
You should also compare your priority list and price range and then widen your net initially based on possible amenities. For example, a major thoroughfare nearby could get you to work faster.
A big priority is to check out the school district, walkability, and crime rate. While real estate agents can’t tell you whether a neighborhood is “good” or “bad” in so many terms, you can find out a lot by digging around online for school ratings and demographics. School Digger and GreatSchools are great resources.
For crime statistics, you can use a crime-mapping tool from the local police department. For walkability, check out Walk Score.
Making an Offer that Stands Out
Once you’ve found a home that you love and you’re ready to make an offer, it’s time to make sure your offer stands out from the crowd.
The first key is someone who’s already been helping you: a great real estate agent.
That’s because, when you’re competing with other potential buyers, you need to know what matters most to the sellers.
For example, sellers may want to stay in their home until they close on their next house, which is called rent-back. Usually, real estate agents will recommend making the rent-back free.
There’s also the matter of contingencies.
In general, it’s a good idea to have as few contingencies as possible. That’s not to say you shouldn’t have any, but rather to be smart about the ones you keep. For example, you should always have a home inspection as a contingency. The form of the inspection can vary based on the situation in question.
You also need a strong preapproval letter from your lender. The lender has a huge impact on how the transaction proceeds–if a listing agent has never heard of the lender, or if they’ve had bad experiences with the lender in the past, they’re going to say something to the sellers.
Ready to Find Your First House?
With your Shreverport-Bossier real estate buyers guide in your pocket, you’re ready to invest in a home!
It all starts with a great real estate agent.