4 Ways to Make a Strong Offer in Today’s Market
Scared to buy because of the market? You don’t need to be, but you do need to be prepared. Preparation is your Agent’s job. Personally, I don’t sugar coat it. I try to be open and honest when providing tactics for my clients to consider – CONSIDER being the key word. From there, it is up to YOU to decide what you are and are not comfortable with.
As I always say, make the best offer you can so that if you get it, you’re happy and if you don’t, you can accept that knowing you did all you could. Trust what’s meant to be will be so long as you put your best foot forward.
It may surprise you but price isn’t always the most important factor. Sellers are usually looking for an offer that has the least amount of risk. A risk could cause a transaction to fall apart. Or unexpected costs to fall on the Seller. In this market, Sellers have the upper hand, so they want to accept a clean offer that is most likely to yield a smooth transaction.
Here are a few strategies I’ve seen win offers for Buyers:
1. Leverage an Escalation Clause.
An Escalation Clause allows you to offer a certain amount over another potential offer. For example, if you want to offer $400,000 but don’t want to lose it over $5,000, you can add an escalation clause saying you’d be willing to pay $1,000 over another offer up to a max of $405,000 with proof of the competing offer.
2. Increase Deposits.
Deposits act as a Buyer’s skin in the game. If you adhere to the terms of the contract, your deposits are credited to you at closing. Increase your deposits to show how serious you are and help make your offer stand out.
3. Consider Appraisal Clauses.
This is a BIG one for Sellers right now. The question becomes, will the property appraise for what you’re offering? Some Buyers are willing to cover all or a portion of the difference. This is a case where price isn’t most important. For example: A home is listed for $400,000. Buyer 1 offers $450,000 but the property must appraise at or above the purchase price. Buyer 2 offers $430,000 but will cover any potential appraisal spread…Buyer 2 may be more appealing to the Seller.
4. Inspections…
This is a hard one for me. In good conscious, as an Agent looking out for my Buyers’ best interest, I cannot recommend waiving a home inspection. But people are doing it (UGH). There are a few strategies to try to be competitive while still protecting yourself in some capacity. Inspections for “informational purposes only” or limited inspections or agreeing to accept up to a certain amount in potential repairs noted.
Hiring an Agent that is full-time and in the real estate trenches every day is also key. Being successful in this market takes time, patience, and a knowledgeable professional in your corner to coach you through it.
Do you have questions about starting your home search? Message me. I’m always happy to have a stress-free, open conversation.
