Thursday, March 10, 2022 / by Ryan Nager
6 Tips To Help Buyers Compete
I’m sharing six things you can do to bolster your offer’s appeal.
In today’s market, many buyers are wondering if it’s worth going through all the effort to secure themselves a house with such little inventory available. After all, only one offer per home is accepted, and it can make the process frustrating if you don’t have the right tools at your disposal. Here are a couple of things you can do to make your offer stand out from the competition:
1. Submit a large earnest money deposit. Remember that your earnest money deposit goes toward your down payment at closing and that you can get that money back during various points of the loan process. There’s no risk to you, but to a seller, a larger deposit shows that you have both the resources and backing to make it to the closing table.
2. Get pre-approved with a lender. Before you even submit an offer, you need to speak with a lender. Get educated about the numbers so that you can make the strongest offer possible. Contingencies also affect your offer’s strength. Many sellers are opting to only accept cash offers because they feel like those are easier to deal with compared to offers that come with loan contingencies. Offers with fewer contingencies are seen, in the seller’s eyes, as more on par with cash offers. Our brokerage has partnered with Homeward, a company that gives an option to turn financed offers into cash offers.
3. Give the seller time to move out. Sellers have to find somewhere to live, too. If they don’t already have somewhere lined up in this competitive market, you have the option to give them a little bit of leeway and stay in the home after closing. That will sweeten the deal for them, especially if you can offer that period with little to no compensation from the seller.
4. Write a personal letter to the sellers. Real estate is still an emotional game, so writing a personal letter to the sellers can help tug on their heartstrings and tilt the scales in your favor.
5. Lead with your best offer first. We don’t expect a lot of back-and-forth negotiation in today’s market; sellers have a lot of options. They’re tired. Many times, they just want to work with one offer that sticks out to them, and that’s why your first offer needs to be your best. Be willing to get creative with some of the terms of the deal, whether that be waiving the appraisal or shortening the inspection period. Doing so can make you look much more appealing to the seller.
6. Consider making a backup offer. Submitting a contract and not getting it accepted right away can be heartbreaking. However, keep in mind that around 15% of all escrows are canceled during the inspection period, so some offers that were initially accepted don’t work out. Making a backup can help you cover your bases and increase the chances of yours getting accepted in case the initial offer falls through. We can even write an addendum into your offer that details the terms of the backup.
Of course, we can help buyers do much more to enhance their offers. If you’re thinking about buying a home and want the best chance to succeed, or if you have any questions, don’t hesitate to give us a call or send an email. We’d love the opportunity to work with you.