Are you ready to make an offer on your dream house? After all, you have found the perfect home for your family’s needs so it’s a done deal, right? Even if you are willing to pay the asking price it is not always so straightforward. Under a seller’s market, there are more home buyers than there are homes for sale. As such, your full-price offer may just not be good enough. So what can you do to ensure you get the home of your dreams? Here are some ways to get your offer accepted in a seller’s market.
Present a clean offer
To start with, make your offer as clean as possible. This means your offer must not be contingent on the sale of another property. Besides this, your offer should not have other financial constraints. Moreover, a clean offer is not subject to seller concessions. This means as the buyer you are not asking for items that are outside of the offer price. Even without contingencies to your offer, there are still ways you can safeguard your interests. For example, you can have your home loan underwritten. This means you can complete the entire loan process with the lender before you make an offer. As such, there is no danger of you failing to secure the mortgage loan.
Do not ask for personal property
Secondly, you should avoid asking for personal property. You might find certain items in the house attractive and would like to add them to your collection. However, avoid asking for items that are listed as part of the exclusions. You risk having your offer overlooked for a similar one that is not asking for the seller’s items. Therefore, asking for exclusions could significantly weaken your offer. Remember that if you want your offer to seriously compete then you must remain focused on the ultimate objective and not get distracted.
Personally correspond with the seller
Some sellers are emotionally attached to their homes and are only willing to part with them when they are convinced they will be in good hands. By personally corresponding with the seller you can convince them that you genuinely care about the property and will take good care of it. You can attach a letter to your offer that tells the seller a bit about yourself, explains why you love the house and why you want to make it your home.
Make an offer above asking price
A seller’s market is not for making low offers. In fact, you will need to make your offer strong enough outbid multiple offers. That means if you want the house you will most likely have to go above asking price. Going above asking price will show the seller that you are a serious and motivated buyer. This will help the seller see you as a prospective buyer. Do not be overwhelmed by the thought of going above the asking price. In most cases, you will only have to go above the asking price by a few thousand dollars. Moreover, making an offer above the asking price will not cost you much in the long run. Your down payment and monthly mortgage payments will not change by much if you make a slightly higher offer.
Put down a strong earnest money deposit
When you put down a large amount as your earnest money deposit, it may indicate to the seller that you are a serious buyer. Earnest money deposits are typically between 1% – 3%, but putting down an amount larger than this will be proof that you are good-faith buyer. However, you risk losing your earnest money deposit if you do not go through with the transaction. As such, only pay a larger earnest money deposit if you intend to buy the house.
Waive the appraisal contingency
Waiving the appraisal contingency is another way that could help your offer get accepted in a seller’s market. However, this poses a huge risk and you must have enough funds to cover the shortfall between the offered price and appraised value. An offer representative of your intent to buy if the home does not appraise will set you apart from the others. Keep in mind that you need to be in a strong financial position to take this risk.
Make a large down payment
Offering to pay more for your down payment is an excellent sign of good faith to your seller. Putting down a larger down payment than is required you send the message that you are serious about buying. Moreover, it shows the seller that you are in a strong financial position and will have no issue meeting your financial obligations.
Pay with cash
Another way of getting your offer accepted in a seller’s market is to propose paying with cash. Sellers prefer dealing with cash offers as it proves that the buyer is serious. Besides this, paying with cash also expedites the closing process.
Make sure your offer is complete
Various mistakes in your offer could cost you getting the home of your dreams. With this in mind, pay attention to the details and contents of your offer. In a seller’s market, these mistakes could lead to your offer being overlooked. To give your offer a chance, ensure that it is complete and you have double-checked all the details.