Just in case you haven’t been paying attention to the real estate market — sellers are having a great year!
Even in Freeport where our market is typically not “hot,” sellers are enjoying the benefits of lack of inventory and anxious buyers. That’s great if you are selling your house but not exactly ideal for buyers. The market is moving quickly, and once a home hits the market there may be multiple offers right away. There are some things you can do as a buyer to put yourself in the best position to make a winning offer.
The first step in the home buying process is always to get pre-approved with a local lender. Please resist the temptation to get pre-approved with an online lender. The commercials might be catchy and they might make some great sounding promises but nothing can take the place of a local lender that you can contact in person and that knows our local market.
Getting pre-approved takes the guesswork out of knowing how much you can afford and can provide a seller with proof that you are a qualified buyer. In this fast-moving market, an offer without a pre-approval probably won’t stand much of a chance of being considered.
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The second step is to partner with a local Realtor that knows our market and can help you in your home search. Houses sometimes sell before they show up on Zillow or Realtor.com and having a local Realtor watching the market for you can sometimes make the difference as to whether or not you can get an offer in on a property you like before it’s gone. Your Realtor is working on your behalf and can help you find a home, structure a great offer and help you negotiate your way to a purchase. They can also help you arrange inspections, refer you to an attorney and navigate the process to get to closing.
After you have your pre-approval and your Realtor selected, you can begin your property search. There is not a lot of inventory on the market so when something becomes available you need to be ready to view the property as soon as possible. Sometimes waiting even one day can be too long. Timing is everything in a busy market and “if you snooze, you lose” right now. If you find a home that you would like to make an offer on, the same thing is true. You have to move quickly.
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When you are ready to make an offer there are some things your Realtor can suggest so your offer is competitive. Obviously, price is important. Remember that you may not get the opportunity to raise your offer so go in with your strongest price initially. Make sure you aren’t exceeding your pre-approval amount and that you are comfortable paying that price if your offer gets accepted. Some other things to consider to make your offer stronger are offering a sizeable earnest money deposit. That can show the seller that you are serious about purchasing their home. Be flexible about closing dates. If the seller needs a longer or shorter close time, being open to adjusting the closing date can be attractive to a seller.
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Consider limiting the number of contingencies in your offer. If you are comfortable with waiving inspections, that can be very attractive to a seller. You should only do that if you are willing to accept the property in the condition it is in and are willing and able to make repairs yourself. Don’t ask the seller to pay closing costs or make extra repairs unless you are required to do so because of the type of loan you are getting. If you do need to ask for seller concessions, you should raise your offer price to make it more desirable to the seller. If you structure your offer with some of these items and you offer your maximum price, but the seller gives you a counter offer asking for more, know when to walk away. Don’t let your emotions get in the way of common sense.
Your Realtor can help you decide how much is too much so you don’t make an expensive mistake. They can show you comparable sales so you know the value of the property you are trying to buy and don’t overpay. Remember, when you are looking for a home, flexibility and prioritizing needs over wants are key. Being well prepared and knowing what to expect can help you make a winning offer while keeping your finances and priorities in balance.
Anne Sadler is the designated managing broker/owner of Choice Realty in Freeport.
