While touring open houses in downtown Fargo, you still often encounter people looking at properties without pre-approval. In the past, it was fine to take a few days to think about a house you liked because there was plenty of inventory, but that's not the case anymore. As of February this year, the inventory of homes in the Fargo area has decreased by 11.16% compared to a year ago, with only 609 homes available (according to fargohomesearch.com), and popular listings are receiving offers that waive contingencies.

According to Redfin, the median sale price in Fargo has recently risen to $301,000, which is a 6.8% increase from a year ago, and homes with offers are going pending in an average of 48 days. Zillow reports that the average home value is around $291,493, which has also increased by 3.7%. In this market, if you start looking for a home without a pre-approval letter, sellers will naturally prioritize offers from buyers who have confirmed funding. This gap is even more pronounced in areas like South Fargo and West Fargo, where demand for new construction is high.

Another common issue is skipping the home inspection. In competitive markets, it's not unusual for buyers to waive inspection contingencies entirely when signing contracts. North Dakota winters can be particularly harsh on plumbing and insulation. In the past, buyers could afford to inspect and negotiate on these items, but now, many find themselves facing unexpected repair costs during their first winter after moving in. Instead of completely skipping the inspection, suggesting a conditional inspection for informational purposes to the seller could be a viable compromise.

Failing to calculate closing costs separately from the down payment is also a frequent mistake. Closing costs typically range from 2% to 5% of the sale price (according to Bankrate), and if you use your down payment to cover these costs, you may find yourself short on funds right after moving in. North Dakota's effective property tax rate is around 0.99% (according to Tax Foundation, propertytaxrates.org), which is slightly higher than the national average, so it's important to include the monthly escrow amount in your budget. If you're moving to a high-tax area like Cass County, you should pay extra attention to this aspect.

In areas with a significant Korean community, it's common to check school district ratings as well. However, school district boundaries change frequently, and the criteria for rating can vary by site, so it's best to use GreatSchools or Niche scores as a reference and verify the assigned school through the school district office before making a purchase.

Many buyers still only meet with one lender before making a decision. The Consumer Financial Protection Bureau recommends comparing rates from at least three lenders, especially when the market is moving so quickly. In such a fast-paced environment, it's better to get pre-approved by multiple lenders to find the most favorable terms and be prepared. It's ultimately a more stable choice to wait for opportunities while being prepared than to rush into a contract and miss out.

Be cautious about buying a new car or making large credit card purchases right before closing. The Consumer Financial Protection Bureau warns that even after receiving pre-approval, changes in your credit score or debt-to-income ratio before closing can alter your final loan terms. In the past, it was common to buy appliances or furniture on credit just before closing, but during a time when loan conditions are re-evaluated right before closing, it's safer to postpone such expenses until after moving in.

Long-term considerations should also include commute distance and resale potential. Fargo is seeing new developments in the South and West areas, but it's worth monitoring whether currently popular neighborhoods will maintain the same demand in a few years. Markets that have been observed for a long time often show that once-hot areas can cool down over time, so it's better to assess based on your actual living plans rather than just the current atmosphere.

This article is not investment or legal advice, and it's advisable to consult with mortgage, tax, and real estate professionals before making any contracts.