It seems as if the real estate market has been on fire in several parts of the country. Interest rates remain low and buyers are out in full force.
That’s great news if you’re looking to sell your house. Not so much if you’re looking to buy your house. Why?
Because there is a lot of competition for the houses that are for sale. In fact, a lot of the homes that are for sale, are getting multiple offers.
If you find yourself in a situation where the house you want has multiple offers, talk with your agent to see what you can do to win the bidding war. Asking your agent to start a dialogue with the listing agent is a good thing. Find out if there’s anything in particular that the sellers are looking for or anything specifically that could get your offer to stand out.
If the listing agent is reluctant to share or seems to be keeping their cards close to the chest, here are a few tips to get your offer noticed and considered.
When it comes to the sales price, anything under the full asking price probably won’t be considered. You’re going to have to come in above or at least at the full asking price. Most offers will be above the asking price. If you choose to do that, don’t get too carried away.
An above-asking price offer isn’t any good if the house won’t appraise for that value. Sellers and listing agents know that. So unless you’re willing to waive the appraisal or pay more for the house than it’s worth (and that’s ok too), keep your above offer price somewhat reasonable. But the over-asking price is the way to go.
Asking the sellers to pay all or even contribute to some of the closing costs should be avoided if possible. If you’re in a position where you need some help with closing costs and it’s unavoidable, that’s one thing. But if you can pay your own closing costs, you definitely should.
Seller contributions, whether it’s closing costs, home warranties, carpet allowances, or any other concession eat away at the sellers’ net profit. And that’s what they’re going to be looking at.
There will be other opportunities to negotiate things like that (after the inspection and/or appraisal). Including concessions right off the bat with your offer will likely encourage sellers to pass on your offer.
When submitting your offer, be sure to include your pre-approval letter. You want to present yourself as an excited, willing, and able buyer to the sellers. You want the sellers to know that if they choose you, the deal will close (and close on time).
A pre-approval letter shows that you’ve been in contact with a mortgage lender and taken all the financial prerequisites. If you’re a cash buyer, be willing to provide some sort of proof of funds, whether that’s a letter from your bank or
print off your bank statement.
It can be tough out there. It can be discouraging to lose in multiple offers, but don’t lose hope!