In a seller's market there are more buyers than there are homes available. This is helpful for the sellers because they might receive multiple offers on their home and can decide which offer is best for them. However, this can make it difficult for buyers who might be competing with several other buyers for the same home. It is important for a buyer to be prepared going into a seller's market.
So how do you do this? Here is what we recommend:
Talking with a lender before you start searching for homes is crucial. You want to talk with a reliable, reputable lender and have a pre-approval in hand and know exactly how much cash you will need to purchase a home. Getting pre-approved will require you getting the lender different documents like pay stubs and bank statements. You also want to make sure your letter does not say pre-qualified but says pre-approved. There is a big difference in how a seller feels about your letter based on how it reads. A reputable lender can play a role in winning an offer and getting you to the close table. There are some lenders/banks that have a bad reputation for not closing on time or meeting financing contingency deadlines. You want to make sure you are not working with one of these so that isn’t what is preventing your offer from being accepted by a seller.
Talking with an agent before jumping in and looking at homes in person is very important. You want an experienced agent working on your behalf. You want an agent who knows the market and knows what houses are selling for in comparison to what they are listed for. You want an agent who is proactive in finding out what is important to the seller of the home you want to make an offer on. The more you know, the more appealing you can make your offer. You also need an agent who can go over the terms of an offer and the different options for writing terms and contingencies. If there are several offers with the same offer price, the seller is going to look for the one with the best terms. What does that mean? For example, no finance contingency (this can be done even if you're getting a loan), have a favorable close date the seller prefers, you can change the inspection paragraph in a number of ways to make it more appealing to a seller, remove the appraisal rider, etc. Of course, a great agent will discuss all these with you and how they affect you and your offer to make sure you feel comfortable with how your offer is written.
Lastly, you need to know exactly what you are looking for in a home and what you are willing to forfeit. This includes the location of the home. Think very hard about where you really are willing to live. Do research on school districts/area before you look at homes so you are prepared. You might only get one chance to view a home before having to make a decision on writing an offer and you may only have a short time to make a decision about making an offer. It's important that you know what you are looking for so you can make the decision that is best for you in a timely manner.
Bottom line, buying a home takes a team. Don't leave who you work with to chance. Make sure you have the right, experienced professionals working for you so you get the house you want.
Reach out to interview our team and take advantage of our FREE buyer consultation to get you on the way to buying your next home.