Sometimes homebuyers wonder if it’s even worth trying to compete against other buyers in a seller’s market when there is very little inventory in the market. It’s not unusual for a seller to receive multiple offers, and it’s almost always a good idea to write an offer anyway. Here are some tips to help your purchase offer outshine the rest:
1. Submit a large earnest money deposit. Pending home sales sometimes blow up. Many sellers are worried that once they commit to an offer, the winning buyers might back out of the transaction or default on the contract after all the other buyers have disappeared. The earnest money deposit is part of your down payment. By increasing it above normal limits, you’re showing the seller that you’re serious about closing. You’re only offering the seller more money sooner than later, but it speaks volumes.
2. Show the sellers that you’re qualified. Almost every offer will be accompanied by a lender letter to stand out. Ask your lender for a pre-approval, which is different than a pre-qualified letter. Being pre-approved makes you a stronger buyer in the seller’s eyes.
3. Give the sellers time to move. Buyer possession is often a sticking point; it’s hard enough to juggle multiple closings if you are selling and buying simultaneously, and it’s even more difficult if the sellers are doing the same. Cut the seller some slack by being flexible with the closing and move-in dates.
4. Write your best offer. Don’t hope for negotiation; offer your highest price. You can make it even more attractive by going a little above asking price. Ask your agent for a comparative market analysis to determine pricing. Sometimes sellers deliberately set a price below comparative sales in an effort to generate multiple offers, so paying a little extra doesn’t necessarily mean you’re paying over the market.
If you have any question about purchasing a home in today’s market, please feel free to reach out to me. I’d be glad to help.