In our current market, there are at least 40 percent fewer homes on the market than a year ago. Buyers who are serious have probably already experienced the disappointment of losing a home due to increased competition. Today, buyers are looking for ways to improve their chances of having the best contract without using the purchase price as their only tool.
First, buyers should rethink, re-evaluate, and reconsider their “must-have” features and amenities. In a normal market, it is probably unrealistic to think you can get the perfect home at your price and in today’s market, it is less possible. Make a list of the things you need and a list of the things you want and prioritize the items. Try to identify what is critical and what is just convenience.
Your next step is to build your “home” team. Although you are the captain of the process, it is essential you have a strong first officer and that would be your Realtor®. This professional will oversee your process, advise on current market conditions and what is normal procedures. Your “first officer” will help assemble the rest of the team to include a mortgage officer, title company, insurance agency, home warranty, inspectors, and service provider recommendations.
Your Realtor® will be able to advocate your cause personally to the listing agent by delivering the offer in-person and expounding your strong points to lobby your position. In the interest of privacy, your Realtor® will not share any information that you have not expressly given them permission to share.
Before the offer is written, your Realtor® can inquire with the listing agent for any preferences that the seller has not mentioned in the listing agreement and can ask about proper forms and addendums.
The following list of suggestions is provided for your consideration realizing that some may not be appropriate for your individual financial situation or comfort level.
- Get pre-approved from a local lender and include documentation with the offer to purchase.
- Have lender phone and email listing agent to expound on pre-approval.
- Increase the amount of earnest money.
- Acknowledge flexibility on closing and occupancy dates.
- Eliminate unnecessary contingencies.
- Waive the appraisal and have proof of funds to meet the difference in the purchase price.
- Avoid concessions like asking the seller to pay the buyer’s closing costs or points.
- Avoid including personal property to go with the sale unless specified in the listing agreement.
- Purchase “as is” with the right of quick inspection to cancel the contract if the condition is unacceptable.
- Shorten time frames on necessary contingencies.
- Attach proof of funds for down payment or full purchase price if cash.
- Arrange bridge financing to be able to pay cash.
- Buyer should pay their own normal closing costs.
- Write a personal note to the seller explaining why you like and want their home. Some listing agents are advising sellers to not accept them due to potential discrimination liability.
- Escalation clause … offer to pay $X,000 more than highest acceptable offer up to a limit.
- If you physically sign the offer, use contrasting color ink to add a personal touch. If using a digital contract, change the font and color to distinguish the signature.
- Make your best offer first because they may not make a counteroffer.
It is commonplace for there to be a rush of interested buyers when a new listing hits the market which can result in multiple offers. Research and consider which of the ideas above you can implement before you find a home; it is better to make these decisions when you have more time especially if it involves a mortgage officer or an attorney.
I can tell you if these suggestions are viable and can offer additional recommendations. If you do not have an agent, contact me at (703) 303-4010 or Thierry@ThierryRoche.com to discuss a plan to craft your offer in the most favorable way possible.
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