As many of you already know, I am primarily a buyer’s consultant. I work with buyers who are ready to make one of the biggest purchases of their lives. For many, this is a dream come true! I for one, do not take this lightly. When I work with buyers, I put everything into helping them. I help with financing, I negotiate offers, and I work steadily to ensure that everything stays on track until the home is theirs.
However, these days the home buying process is all the more tricky. Today, we are in what may refer to as a seller’s market. Although there are fewer homes on the market than usual, interest rates are still historically low. This means that even though the competition is fierce, it is still a great time to buy.
Here are the big challenges for buyers in a seller’s market.
- Fewer Homes – Fewer homes means limited options. This means that buying a fixer-upper or a new build are great options for those who want a home that fits a specific taste. Renovation loans are available to help with costs. The renovation can be rolled into the cost of the loan and paid just as a traditional mortgage would.
- More Competition – Everyone wants a good deal. However, in a seller’s market, you need to be smart about how to get a good deal. Before you even begin looking, it is best to decide how much you are really ready and able to spend on your home purchase. If you really want the home and there are multiple offers then knowing that number is important. In these situations, you will need to put your best foot forward by making your offer as appealing as possible. After all, to win a competition you will need to stand out from the rest.
- Less Time – Homes go fast in a seller’s market. Yes, it would be nice to have a little extra time to make decisions. But, in a seller’s market, you need to act fast when you find a home that you love.
Tips To Win The Contract –
- Show your qualifications – Show that you are qualified to purchase the home by submitting your proof of funds or pre-qualification letter with your offer.
- Don’t be demanding – In a buyer’s market, a homebuyer can get away with asking for many demands. However, in a seller’s market the fewer demands you ask of the seller the better your offer fares.
- Highest and best – In a really competitive market you do not want to submit a low offer hoping that the seller will counter. This offer may be your only chance if the seller receives multiple offers. From the start, it is better to put your best foot forward.
- More earnest money – The earnest money deposit shows your commitment to the transaction. If all other things are equal, a healthy earnest money deposit can push you ahead of other buyers.
- Cash- Cash really is king in a seller’s market. Using cash means a shorter time to close and fewer contingencies. Motivated sellers have even been known to take lower cash offers over higher offers that are contingent on financing.
- Shorten inspections – Shortening the time for inspections is one way to give your offer an edge. The traditional period in Tallahassee is 15 days but a 10 day inspection period is also very do-able and will show the sellers your motivation to close quickly.
- Offer a quick close – If I offered you money in 30 days or in 20 days, which would you prefer? Of course, you said 20 days! Who doesn’t want to get paid sooner? The seller sure does! Offering a shorter time to close is always a surefire way to appeal to sellers.