10 Tips to get your offer accepted in a Sellers Market!
You’re finally ready to take the plunge and put in an offer on your dream house. You found something that is perfect for you and your family’s needs and you’re willing to pay the asking price. It’s a sure thing, right? Not so fast.
Compared to a buyer’s market, a seller’s market means that there are more buyers than there are homes available for sale. It may mean that your full-price offer just isn’t going to cut it. So, what can you do to get that perfect house you’ve searched for high and low? These tips might even get your offer accepted.
Make Your Offer As Clean As Possible
A clean, no-contingency offer means that you’re waiving all contingencies in order to make your bid a bit more competitive and appealing to the seller. A clean offer should not be contingent on the sale of another property or have other financial constraints. It should also be free of seller concessions, which are things that a buyer asks for outside of the offer price, such as help with closing costs. When a seller is receiving a ton of bids, choosing to make a clean offer can help you beat out other offers with contingencies.
Shane Renard with Renard Realty Group, states, “I advise my clients that the traditional contingencies are like a deck of cards you hold to your chest for protection: loan, appraisal and inspection are the main ones. As you lay them on the table, you give them up, which makes your offer more appealing to a seller because you have less opportunity to back out of a contract that you write.”
Renard suggests that even if you don’t add contingencies to your offer, there are still ways to protect your interests. For example, you can get your loan fully underwritten. This means that you will complete the entire loan process with your lender before making an offer on a home. Then when you put an offer in you can confidently put down your loan contingency with little to no risk.
Shane also suggests that you consider giving up your inspection contingency. If the seller has provided inspection reports from reputable companies, then you can do this with little risk involved.
Trend Report for Howard, WI
245k - Median price of homes for sale
15 - Homes for sale in your area
81 - Days Average time to sell your home
Homes sold in November in your area
24% - 1-Year Change in List Price
43% - 5yr Appreciation Avg.
Seller Current market condition
Avoid Asking For Personal Property
Drooling over the sparkly chandelier listed in the exclusions? Don’t ask for it. Want them to throw in that cool lawn furniture? Skip it. Your offer could be very similar in price to another offer that isn’t asking for items that belong to the seller. Asking for excluded items could weaken your offer.
Shane J. Renard "Renard Realty Group", says, "If you want a chandelier or lawn furniture, go to Home Depot. If you want to seriously compete for and win the bid on this house, it is important for you to remain focused in achieving your goal: buying the house, and hope your competition falls in love with the chandelier."
The seller’s market is not the place for making low offers and hoping someone will bite. You will have to make your offer strong enough to beat out a multiple-bid situation. If you want the house, you’re likely going to have to go above the asking price.
Don’t allow the thought of offering over the asking price overwhelm you. Sometimes, you only need to offer $2,000 – $3,000 more to get the seller’s attention. Doing this will show the seller that you’re serious about buying the home, and that you want them to consider you as a potential buyer.
Making an offer above the asking price won’t end up costing you much in the long run. What you put down and what you pay monthly on your mortgage will only change significantly if you offer an amount far above asking. Keeping your offer aligned to the home’s value, while still above the asking price, will help you secure the home you’re interested in.
Put Down A Stronger Earnest Money Deposit (EMD)
Your earnest money deposit is proof that you are a good-faith buyer. Usually, the real estate broker will hold onto your EMD and put it in an escrow account. Later on, your EMD can contribute to your down payment and closing cost. On average, EMDs are about 1 – 3% of the purchase price of the home. If you put a larger amount down, it may show that you are a serious buyer and that your intentions are genuine.
But, if you do put more of an EMD down, make sure you intend to buy the home. If you don’t end up moving forward with the purchase, your EMD may be in jeopardy. If you’ve already signed the contract and don’t buy the home, the seller could keep your EMD as compensation for the time wasted.