Just a few weeks ago I reached out to a family that I knew was starting their home search. It was a family that really really really wanted to work with to help them find a house. I thought our initial meeting went well. Rapport is very important to me. I followed up with them professionally. Also, I would get a glimpse of them out and about in the area and always wanted them to know that whether we did work together or not I would like to stay in touch.
Well fast forward, they decided to work with a family member that they learned had a real estate license. Sad face! They broke the news to me gently but it hurt anyway. This was December. I know because I called to begin what I knew would be a whirlwind of a house hunt.
Like I started to share - just a few weeks back, I called to see how they were doing with their home search. Well, as expected, it has been a challenge. I just encouraged them to be 'on the ready', patience is important and don't "over" overpay.
Here, I will share just a few buyer strategies that have worked for me when working with a client as their Buyer's Agent as well as what I look for when representing my seller clients and reviewing the monetary strength of an offer or multiple offers with them.
1) You must start looking well before you are ready to buy. Get familiar with the process of viewing homes and submitting an offer. Take the stress off by familiarizing yourself with the purchase offer, concessions you will want or need, how much you really want to spend, your mortgage provider's or real estate agent's style etc. While in the market well in advance begin to really notice what is being offered for the money. Every area is different in that certain price points will offer certain features, finishes, and concessions as the norm. You will be leaps and bounds ahead of the first timers that walk in with no clue. You will recognize a good buy and reduce your anxiety levels allowing you to think more clearly on how to make a competive that you and the seller can move forward with.
2) Price is not the only negotiable variable in a purchase offer. Some top ones: tighten up your seller concessions - what do you really need, incentives are they being offered and are they really needed, faster or more flexible closing for the sellee, preapproved versus prequalified, take something off the homeowners "to do" list, offer quicker inspection turnaround (never remove your inspection contingency unless you are a very experienced & very knowledgeable buyer).
3) Prepare/Write out a drafted contract for the top 2 to 3 you will view. We do not use carbon copies any longer so definitely doable. Based on MLS data, pictures, your preapproval and your knowledge of the market (refer to point number 1), you should be more than 90% ready to sign and send, notify agent of your offer before even leaving the house. Hey, in a competitive market, don't take the seller up on their home warranty incentive and/or carpet cleaning incentive unless they are really needed because of the uncertainty of the house. Let them keep their $700 /- and strengthen your offer by improving their bottomline. Make sure your agent shares this with them so it will not go unnoticed. Maybe your agent will help with one or both (hint!).
4) Do not give up your future equity or at least, do not give up all your future equity. If you "over" overpay that is exactly what is happening. Strong seller markets like these do not last forever and often will not repeat for another 10 years. Think "cycles". When will your cycle come around? This can occur very easily in new construction and also, in areas where there is "sweet spot pricing" because values get skewed. So be on alert.
5) On the other side of your offer there are people: homeowner(s) aka Seller(s) and Agent(s). They are seeing you and your intentions through a 5 to 10 page contract. Prepare and present a clean and comprehensive offer that says exactly what you need it to convey. Avoid thoughtless increases over asking that make for future sleepless nights for you (no equity left for you after closing). Avoid over complicating it. Be honest!
Definitely a whirlwind of a market out there. Use these buyer strategies and you can't go wrong. You will be confident. You will negotiate a competitive offer. You will pay the right price for the market you are in. You will consciously adjust your term without fear.
Call if you need my help - 719-200-6940