5 Tips For Buying In A Sellers Market

It’s no secret that buyers have been writing offers only to find that they are up against countless other offers. This could lead to feelings of defeat and failure. However, there are things buyers can do to get their offers noticed by sellers. Here are some easy tips for buying during a seller’s market:

PERSONALIZE YOUR OFFER

As a listing agent, we receive hundreds of offers each year. And, they all look the same: standard residential purchase agreement, standard earnest deposit, one of four kinds of financing (FHA, VA, Conventional, or Cash), and standard terms. To a seller, you are simply dollars and cents. 

But, what if you were to personalize that offer with a letter, family photo, and message to the seller? Or, even one step better, why not attach a video of your family and a personal message?

Do you think this might tug at their heartstrings a bit when they see little Johnny smiling back at them and mentioning he wants room for a swing set? Simple steps like these can help you stand out.

INCREASE YOUR EARNEST DEPOSIT

When all things are equal, your deposit can make a difference. Let's say, for example, your competition puts down 1% or a standard earnest deposit of $5,000. How much more convincing would you look to your seller if you put more money up front to show intent, say $10,000 or $20,000?

Keep in mind this money is refundable up until the time you release your loan contingencies, but putting more down up front will show your willingness to earn trust. 

PICK YOUR AGENT REPRESENTATION WELL

We all have someone that is a friend or neighbor that has a license, but a real estate agent professional that has hundreds of deals behind them will know that the listing agent is the gatekeeper. 

It is truly important for a seller to get a hold of the listing agent, pitch for your client, and give the Listing Agent a sense of comfort and direction this transaction will take. 

The sellers will lean on the agent to help choose the offer that is most likely to close on time.

How would they know this if your agent didn’t go to bat for you? Fight for your offer and defend your choice of lender. Really guys, this is a BIG DEAL when getting your offer selected.

KNOW HOW TO WRITE A STANDOUT OFFER

Often, a buyer is hopeful that the sellers will provide the best home warranty, take care of all the repairs, and leave the washer, dryer AND refrigerator. Don’t forget to give money for closing costs, OH AND A DISCOUNT and I HAVE A HOUSE TO SELL! 

Are you kidding me? In a seller’s market, that is the equivalent of hiking up Mt. Everest with a day pack.

If your agent is experienced, they will share with you that it's important to keep your offer clean. Come in strong with a full price or at some range over, minimize the items you ask the seller for at this point (you could always ask for repairs later in the inspection phase), and be prepared to shoulder your own closing costs. 

Sellers have the burden of paying all realtors, title fees, escrow and taxes. They are not looking to take on more. If you are hoping for any chance of an accepted offer, try to avoid these simple mistakes.

OFFER NON-PRICE FACTORS

In a seller’s market, buyers may have to consider waiving the financial contingencies. Or, they may need to limit inspections to shorter, 3-5 day periods as well as place larger deposits to provide a non-price consideration. 

In this kind of seller's market, homes may not appraise at the highest offer and then the loan won’t be approved. A lower offer with a strong non-price factor could win out. If you are a buyer coming in with 20% down, you may find it helpful to waive your appraisal contingency and come in with your best price first, knocking out the competition right away.

EXPERIENCE SERVES YOU WELL

When your family home is on the line, it's always best to work with an experienced and seasoned agent that has lived through past sellers’ markets. Experience makes the best teacher. And, when your pride wants to get the best price, understanding the power of supply and demand will be a great reminder to your ultimate goal of homeownership.

For more information, visit us online at JonesRealtyGroupSoCal.com or call Liz Jones at 951-970-4771.