It’s Not Just The Price…
Buyers are facing an uphill battle to buy a home in this current market. Having a plan to succeed is critical and knowing what to do to create an offer that makes you the early favorite in the current multiple offer market.
Its really important to understand that the best offer is a combination of things and not necessarily the highest price. Also your offer can be amended after its is sent to make it more appealing as you understand more about what the seller needs to sell are.
How To Make A Winning Offer:
Here are steps that help.
- Learn the market. It’s important to understand the inventory of the homes you want to buy. What are the recent sales? How many offers were made? Did the sales price over the list price?. Your agent should be able to guide you about the local sales.
- Find out the seller’s motivations. This is key and really important. If you’re working with an agent, you can request that they try to find out why the seller is looking to move from the seller’s agent. If the seller’s agent is facing a lot of time pressure and needs to get the place sold ASAP, that puts you in a much better position to push for a better price. Don;t be afraid to pick up the phone and call if you don’t know.
- Make a good, strong offer. Even when you’re making a winning offer, you want your offer as appealing and reasonable as it can be. The information you found out from the seller or seller’s agent can help. Use that information in your offer to make your offer better. For example, you might waive certain repairs, or shorten the contingency period. Quick Tip for a Seller’s Market: A quick close (21 days) and a seller can remain in possession for a period of time at no cost can often save you money or get a favorable counter offer.
- Don’t count on a “Multiple Buyer” counter offer. Your first offer is highly unlikely to be accepted by the seller in a Seller’s market but may be accepted by modifying the terms of your initial offer or more importantly trying to convince the seller’s agent to make an acceptable offer work with your offer. Make sure you work closely with your agent to again understand the issue with your offer when you receive a counter offer from the seller. From my experience little things that are not necessarily related to the offer price can be worked out when time is taken to understand the counter offer or addendum. Time isn’t your friend when negotiating so you should try to complete any negotiation within 24 hours if possible.
- The Listing Agent is the Key. If you have hired the right agent, he should be able to understand the seller’s motivations, get the information on the pricing the selling agent recommended for the house Bottomline, the listing agent is the gateway for your offer to be accepted. In the end selling your offer to the listing agent. Do your homework on the Listing agent for success.
Making an Winning Offer: What is effective and works
- Having a pre-approval letter that is 10% more than your offer price. If the home comes down to negotiating a higher price and your approval letter can;t support the higher price, you won’t win the house.
- Buying the home as-is, and not requesting repairs. If the seller knows that their bottomline isn;t going to change after they are in contract that is helpful for them to decide to choose your offer..
- “Clean Offer” Making the deal more complicated isn;t helpful. Stick within the current time periods for getting things done. Unless you have information that the seller wants inspection times shortened or, keep the offer “clean.”
One Last Thought
A winning offer is more than the price. More importantly make sure you have an agent who will aggressively sell you as the best buyer and is equally focused on helping buyers as well as sellers.