How Buyers Can Make A Purchase Offer Stand Out
Even though January real estate sales slowed slightly from the record highs set last year, the Sarasota market remains quite active. Median home prices continue to climb, combined with a small inventory, but still many mortgage options and low interest rates are readily available, making now a great time to buy a home. With the present demand dynamic, there's a lot of competition to face, so it is imperative to know how buyers can make a purchase offer stand out.
Biggest Home Purchase Offer Mistakes
Purchasing a property begins many months in advance of the actual home search. It should start with being aware of what not to do going into the purchase offer phase. You'll probably pull your credit reports, save money for a down payment, earnest money deposit, inspections, and closing costs. Those are all good things, but, it's all-too-easy to get caught-up in the moment when you find a home. This is where buyers get emotional and attached to a home without really knowing its true value or even if it's actually right for their wants and needs.
You’ve found a home you can afford, in a great neighborhood with good schools. It even has a fenced-in yard for your dog. What could go wrong? Any number of things, ranging from a competing buyer’s all-cash offer to an insufficient earnest money deposit from you. In markets with houses in short supply, sellers have the advantage over buyers, and bidding wars often erupt between buyers vying for the nicest properties. Your purchase offer should persuade sellers that you are a serious contender who will give them most of what they want, even as it protects your interests. --Kiplinger.com
Another big mistake is basing your choice on what fits your present wants and needs; which can certainly change in the future. Even if you do take the future into consideration, you might be tempted to go all-in and pay a bit more for the seemingly perfect home. This can lead to being overextended, something that will be a serious burden to shoulder. Conversely, some buyers believe the process involves tough negotiation and submit lowball offers. That tactic can easily backfire and the home could be sold to another party.
How Buyers can Make a Purchase Offer Stand Out
When you do find the right home, it's important to submit a solid purchase offer. Generally, there are several contingencies included in a standard home offer, which include financing, inspections, appraisal, and so on. Other interested buyers will likely submit very similar purchase offers, so, it's important you know how to make your purchase offer stand out from the competition:
- Make a cash offer. If you are in a position where you can afford to pay cash, this is a great tactic to make your purchase offer the best choice for the seller. It's no secret cash is king and the seller won't have to worry about your financing falling through at an inopportune time. Cash states you are very serious and you have made-up your mind.
- Be specific about the home inspection. Even if you're buying new construction, a home inspection is vital and should never be taken out of the contract. However, these tend to be broad to protect buyers. So, make some adjustments and be more specific, giving the seller more leeway. You should retain the most important elements, but, let the small stuff go.
- Be flexible with the transaction timeline. Typically, there's a set date to close, which can put the seller in an awkward situation. If you can give the seller some flexibility with the timeline, moving settlement day up or back, do so to make your purchase offer more attractive.
- Be prepared to up the price ante, if it becomes necessary. The seller might get competing offers and have a difficult choice to make. Like making up the difference between the home appraisal and the mortgage financing, you can let the seller know you're willing to go up in price to get the home.
Another way to make your purchase offer stand out is to increase your earnest money deposit. It shows you're willing to demonstrate how much you want the house and how committed to the deal you are above your competition.