What can you do to get your offer noticed if you don’t have a huge pile of cash?
I was looking at zillow.com the other day and it said that my area is a hot seller’s market. I know a lot of the country is experiencing the same thing, especially among cheaper, “entry-level” homes.
Sometimes buyers are scared away by the competition of a seller’s market, but most buyers can’t afford to miss out on today’s low interest rates. At the pace the Fed is currently raising rates, waiting a year or two could cost you a couple of percent. That prospect is enough to make most people realize that now is the time to jump in, no matter how ferocious the competition.
How To Gain An Edge Against The Competition
But with most homes getting multiple offers, do you even stand a chance? If you’re not a cash-heavy investor, is there any way for you to compete? Here are some suggestions if you want your offer to make it to the top of the pile:
You don’t need to paint your chest blue or perfect your war cry, but you should hype yourself up. Battling it out in today’s market will require a lot of energy and a positive attitude. Take some time before you start your home search to get your head right and develop a winning attitude.
Stay On Top Of Things
Remember when your mom would tell you “the early bird gets the worm” when she was trying to drag your adolescent body out of bed? Well, that applies to real estate as well. You should try to see any homes that interest you within 24 hours of them being listed.
Stay in close contact with your real estate agent to make sure you don’t miss out on any gems. If you drag your feet, they will be sold before you even pull into the neighborhood.
Get The Right Type Of Loan
FHA and VA loans are provided by the government to help people who otherwise may not qualify for a conventional loan. There is nothing wrong with them, but sellers often give preference to conventional loans or cash. If you can qualify for a conventional loan or have cash, you are already ahead because you are seen as a safer option to sellers.
Pay Your Closing Costs
It is common practice to ask a seller to pay some or all of the closing costs, but that can work against you in today’s market. What seller would pay closing costs when they have other offers that don’t require it?
Have A Down Payment
As always, the bigger the down payment, the better. Sellers know that the more cash a buyer has, the quicker and more secure the transaction will be.
We, humans, are emotional and relational. You may not have a pile of cash to appeal to a seller’s intellect, but you have a personal story to touch their emotions. Write a nice letter introducing yourself and your family and telling the seller why you love their home. Share your hopes and dreams for the home and the memories you want to make there. Most people like to see past the money to the people who will love their home as they have.
Many sellers still need to find a new place to live. If you can be patient and give them time to find their next home, complete the purchase, and move in, you will come out ahead. Many sellers appreciate a buyer who can be flexible with their timeline. In today’s world, time can be just as important as money in some situations.
New construction isn’t usually as competitive as existing homes. That is because brand new usually costs more. However, if you can afford it, you will have less competition and be able to get more of what you want.
If you’re wading into the housing market right now, best of luck to you! Let me know how it goes for you and if you made use of any of my suggestions.