When the real estate market is competitive, it can be hard to make the right offer on your dream home. After spending weeks or even months searching, you don’t want to miss out on that perfect property.
It doesn’t matter if this is the first time you’ve bought a home or you’ve been through the process before, making an acceptable offer in a competitive market isn’t always easy. It’s not just about the price you’re willing to pay. Sellers consider many factors, including price, before accepting an offer from a buyer.
If you’re on the hunt for the perfect home for your family, you’ll want to make sure you know how to make an acceptable offer in a competitive market. Here are a few of the best tips to help you create the best possible offer.
Put Your Best Foot Forward
When you make an offer on a home, you want to make sure the first offer you make is your best offer. A competitive market usually means you’ll be bidding against other potential buyers. If you don’t make your best offer first, you might lose out to someone that did.
The last thing you want to do is underbid hoping to negotiate. Another buyer may come in higher than you, even if just by a little, and you might not make the cut.
Use a Short Expiration to Move Things Along
When the market is competitive, you can add an expiration date to your offer to keep things moving along. Many sellers want to get their home sold fast, anyway, so why not make a great offer with a short expiration?
Using an expiration date can help to ensure the seller doesn’t wait around for something better. You’re more likely to get your offer accepted with an expiration date since the seller may not want to miss out.
Choose the Best Local Real Estate Agent
A great real estate agent with knowledge of the local market will go a very long way to ensuring you make an acceptable offer when the market is competitive. Your agent is in the thick of things every single day and they know exactly what to expect.
A good real estate agent will know the recent sales in the neighborhood and a good offer looks like. They can help direct you on price, contingencies, the expiration date, and other important factors to consider when making an offer on your dream home.
Show the Seller You’re Serious
If you submit an offer without a pre-approval letter or a high earnest money deposit, you may lose out to a better offer. When you’re pre-approved and you have a solid deposit, it communicates you’re a serious buyer.
Since the earnest money deposit is money you won’t get back, if you back out of the deal, a higher than normal amount can make your offer stand out. It shows you’re serious as you’re taking the risk of losing that money if you don’t go through with the deal.
Keep Contingencies to a Minimum
Contingencies are the conditions you expect to be met to finalize the deal. While you don’t want to leave out contingencies, such as a home inspection, you do want to keep them to a minimum in a competitive market.
If you demand too much of a seller, such as asking for the seller to pay for closing costs or wait for you to sell your current property, you may miss out. An offer with the minimum contingencies will likely go to the top of the pile, even if it’s a bit lower than yours.
There are several great ways to ensure you make an acceptable offer in a competitive market. If you hire a good real estate agent, they will provide you with even more advice to ensure your offer is the best it can possibly be.