Tips for buying a home in a Sellers Market
Buyers around the country are astonished at how low mortgage rates are. While some are apprehensive about buying a house during a pandemic, most want to take advantage of the thousands they will save with such low rates. Most buyers face the current challenge of navigating a seller’s market with low inventory and steep competition. However, it is not impossible to buy the house you want! Follow the guidance below for some tricks to buy in a seller’s market.
Get Your Finances Ready
The most important thing you can do before looking at houses is to get your finances in order. If you find yourself competing with other offers, you will need to have a pre-approval from a lender to even be considered. Contact a mortgage lender right away and gather all the documents you may need now and down the road.
Another factor that will make your offer look better is the amount of money you have saved for a down payment. This will show the sellers that you have prepared for buying a house and that your financing is less likely to fall through. Generally-speaking, the greater the down payment, the more attractive the offer is to the seller.
Find a Trusted Real Estate Professional
Make sure you find a real estate professional that is tenacious and knowledgeable about the local market. This is not the time to use your brother-in-law’s aunt who dabbles in real estate part-time. Follow the guidance of your real estate agent throughout the process of buying in a seller’s market. Their expertise can help you to secure the home you really want.
Act Quickly
In a market, with low inventory, you must act quickly. Keep a close eye on listings and go to view homes you’re interested in as soon as possible. Also, once you’ve found a house you like, don’t hesitate on making an offer.
Make Your Best Offer
In a seller’s market, you are most likely going to compete with multiple offers on a house you are interested in. There are strategies that can help you make a solid offer and gain the attention of the seller.
· Don’t Ask for Seller Concessions- asking for seller concessions can lower your chances of outbidding other offers. If you need some closing assistance, offer a higher sales price to offset this assistance.
· Avoid Contingencies Where Possible- an offer that is loaded with contingencies can put up red flags for sellers. If you have a contingency of selling your current home before securing financing, try to make an offer once you’ve already under contract and it has cleared inspection and appraisal.
· Make an Escalation Clause- An escalation clause is another great tool to utilize for a strong offer. It says that this is your initial offer, but if someone outbids you, you are willing to escalate your sales price to a certain point. This clause will show sellers how serious you are about buying the house and protects you from losing it because you didn’t know what others were offering.