Today’s real estate market is highly competitive! We are experiencing record-low inventory in the housing market, with less than half of the number of homes available this time in 2020. Due to supply and demand, low inventory is good news for sellers, but means buyers will be competing with each other for homes now more than ever.
Because you will be competing with many other offers, you might want to consider going above and beyond to make your offer more attractive to sellers. There are a lot of ways you can get creative with your offer to stand out from the pack. I have seen buyers offer all kinds of bonuses in their offers, including Disney passes and even a car! While that might not always be reasonable, these ideas could help you get a leg up over other potential buyers:
1. Waiving inspections or agreeing on a dollar amount you’ll cover for potential problems found during inspections. This is not recommended for older homes or homes in flood zones, but if you’re confident in the property or willing to take a risk, this can be a very useful tool.
2. Use the seller’s preferred title company or other vendors as this will ease their mind in working with you if they are able to work with familiar or chosen clients.
3. Consider an escalation clause with no ceiling, or at least a high threshold. This automatically raises your offer incrementally to beat out other offers, until you reach the threshold you set.
4. Make a sizeable downpayment and offer it as non-refundable, or increase the down payment as needed to sweeten the offer.
5. Cover the seller’s rent or costs of living for up to two months to provide time for them to find a new home. In a market where it can be difficult to find a home, this is especially helpful.
6. Make sure they know the sale is not contingent on the sale of any other current property you may own. This means that your offer stands, whether your previous home sells in time or not.
7. Pre-offer an inspection so that you can waive further inspection fees.
8. Shorten the time frame for contingencies and make things easier on the seller by giving them extra time to make decisions.
9. Waiving appraisal contingencies. This means that in the event that the appraisal comes in over your offer price, you agree to cover the additional cost between the sale price and the appraisal amount, or pay a higher mortgage premium based on the loan value.
10. Pay the seller’s closing costs yourself. This includes tax bills and other expenses in a large lump sum.
11. Be open to conventional financing if it will help the seller, even if better deals are available elsewhere.
12. Make a cash offer and pay your costs all at once in a lump sum if you are able, instead of drawing out the process in financing. Cash means a faster, easier sale with no banks to deal with.
13. Provide all necessary information for the seller to feel comfortable, and a full underwrite on a “To-Be-Determined Property.”
There are many good reasons to have a realtor represent you in your home buying process, but in today’s challenging market, it is crucial! Before you start your home search, contact me. I will advocate for you throughout the home buying process and ensure that you have the most competitive offer while protecting your interests at the negotiation table.