Trying to buy a home in a seller’s market can be difficult, especially when available listings receive multiple offers.
Our current real estate market is red hot for sellers right now, leaving many buyers wondering if it’s even worth it to try and submit an offer on a home. When inventory is low like here, it’s common for sellers to receive as many as 10 offers for their home. This can make it seem intimidating, but it’s almost always worth it to submit your offer.
To make sure your offer outshines the rest, use these tips:
1. Submit a large earnest money deposit: Sometimes deals fall apart and escrow blows up, and sellers worry about this. They worry that a buyer might cancel the contract or default on it. Your earnest money deposit stays in escrow during the transaction and goes toward your down payment, so putting a larger amount into escrow shows sellers that you’re serious and committed and gives them peace of mind. It’s just a little extra money you have to put into escrow, but it speaks volumes to the seller.
2. Send the seller your pre-approval letter: First, talk to your lender and make sure you’re pre-approved—not pre-qualified—for financing and that they write it in a letter you can submit with your offer. This is absolutely critical in our market and shows sellers that you’re a strong buyer.
3. Give the seller some time to move: It can be difficult for buyers and sellers to coordinate multiple closings. If the seller is also buying a new home, cut them some slack by giving them two or three days to move out after closing without asking for any compensation. This will help you win the bid because the sellers will see that you’re flexible and easy to work with.
4. Shorten your contingency periods: This is the time for home inspections and the appraisal, and it doesn’t cost you anything to get them done faster. Home inspections are usually performed in a 17-day window, but why not shorten it up to 10 days and show the seller that you’re acting with urgency for them? If you’re already approved for a loan, you can talk to your lender about shortening that time frame or even waiving the loan contingency altogether.
5. Write the best offer you can: Don’t hope for negotiation; sometimes sellers will simply pick the highest offer and won’t take the time to counter everyone who submits an offer. Put your best foot forward with a strong offer. Sometimes, sellers will price their house below market value to generate multiple offers and bid the price up, so making an offer higher than list price doesn’t necessarily mean you’re offering more than the home’s market value. Take the time to write your strongest offer first.
If you have any questions about strengthening your offer when buying a home or about selling your current house, don’t hesitate to give me a call or send me an email. I would love to help you out!