Buyers: Here are three things you must consider when writing your offer.
If you’re an active buyer in this pandemic-impacted 2020 market, you’ve experienced firsthand the craziness that’s been making headlines. Homes, especially those in the $300,000 range, are flying off the market with multiple offers. We’re seeing an influx of buyers to the market and a shortage of houses, which is ramping up competition and pushing prices a bit higher. So, how can you give the offer the highest chance of success?
1. Do not ask the seller to pay your closing costs. That strategy works in markets where there’s plenty of homes to choose from, but in a strong seller’s market like ours, keep it fair—let the seller pay their closing costs, and agree to pay your own. You can always renegotiate later on, but you should at least avoid asking for this up front.
2. Get rid of that financing contingency. About 97% of buyers are asking the seller to give them about 21 days so they can try to get approval for a loan. For the seller, that’s 21 days of risk; the buyer may or may not get approved. Just imagine how impactful it’d be if you went to the seller and said, “Here’s my offer. By the way, I’m fully approved, so I’m not asking you to give me 21 days.”
If you’ve ever wondered why a seller selected another offer over yours, it’s because that winning buyer was one of the 3% of buyers who sought full approval beforehand. If you can get approved and eliminate this contingency, it’ll make your offer as good as a cash offer.
“Odds are good that your competition isn’t aware of these strategies.”
3. Shorten the length of your inspection period. A lot of other buyers will be asking for 10 to 15 days for the inspection, during which time the buyer can back out of the deal. Essentially, they’re telling the seller that you need them to wait 15 days so you can inspect the property, and if the results displease you, they’ll hit the road. What if you offered seven days instead of 15? It communicates that you’re a serious buyer who’s not interested in wasting anyone’s time.
If you implement these three techniques, you’ll position yourself strongly in the top 3% of buyers out there. Even if you’re competing for the home of your dreams against 10 other offers, the odds are good that your competition isn’t aware of these strategies.
As always, if you have questions about anything real estate-related or there’s a topic you’d like me to cover in an upcoming video, please reach out via phone or email. I’d be happy to discuss any of these principles in greater detail and hear about your particular situation.
