Making Your Best Offer on a House
While the crazy ride that was the 'unicorn' years of housing is over, today's market is still competitive in many locations due to a lack of available homes for sale. If you're seeking to buy a property this season, remember that the peak frenzy of bidding wars has passed, but you may still encounter some multiple-offer circumstances.
Here are a few things to think about when putting in an offer on a home.
1. Lean on a Real Estate Professional
Rely on an agent who can support your goals and help you understand what’s happening in today’s housing market. Agents are experts in the local market and on national trends too. They’ll use both of those areas of expertise to make sure you have all the information you need to move with confidence.
Plus, they know what’s worked for other buyers in your area and what sellers may be looking for in an offer. It may seem simple, but catering to what a seller needs can help your offer stand out. As an article from Forbes says:
"Getting to know a local realtor where you’re hoping to buy can also potentially give you a crucial edge in a tight housing market."
2. Get Pre-Approved for a Home Loan
Having a clear budget in mind is especially important right now given the current affordability challenges. The best way to get a clear picture of what you can borrow is to work with a lender so you can get pre-approved for a home loan.
Because you'll have a greater understanding of your figures, you'll be more financially assured. It also demonstrates to vendors that you are serious. And this can provide you a competitive advantage if you find yourself in a multiple-offer situation.
3. Make a Fair Offer
It’s only natural to want the best deal you can get on a home. However, submitting an offer that’s too low does have some risks. You don’t want to make an offer that will be tossed out as soon as it’s received just to see if it sticks. As Realtor.com explains:
“. . . an offer price that’s significantly lower than the listing price, is often rejected by sellers who feel insulted . . . Most listing agents try to get their sellers to at least enter negotiations with buyers, to counteroffer with a number a little closer to the list price. However, if a seller is offended by a buyer or isn’t taking the buyer seriously, there’s not much you, or the real estate agent, can do.”
The expertise your agent brings to this part of the process will help you stay competitive and find a price that’s fair to you and the seller.
4. Trust Your Agent’s Expertise Throughout Negotiations
In order to put the winning bid on a home during the 'unicorn' years of housing, several purchasers ignored home inspections or did not ask for concessions from the seller. An article from Bankrate explains this isn’t happening as often today, and that’s good news:
“While the market has largely calmed down since then, sellers are still very much in the driver’s seat in this era of scarce housing inventory. It’s not as common for buyers to waive inspections anymore, but it does still happen. . . . It’s in the buyer’s best interest to have a home inspected . . . Inspections alert you to existing or potential problems with the home, giving you not just an early heads up but also a useful negotiating tactic.”
Fortunately, the market has changed, and you may have greater negotiation leverage than previously. When putting up an offer, your experienced real estate expert will assist you in determining which levers to pull and which you may not want to compromise on.
When you buy a home this summer, let’s connect so you have an expert on your side who can help you make your best offer.