Buying a house can be a competitive process, especially in our hot real estate market. This week Martha Brookbank listed a home that had 16 offers the first day and 15 the next. By morning on the third day she had 18 offers in hand. Most or all of them were at or above asking price. It can be challenging to stand out in such a crazy environment. Here are some tips to help you win the offer on your perfect house when you are competing with other
- Use an appraisal gap clause: An appraisal gap clause is an agreement between the buyer and the seller that the buyer will cover the difference between the appraised value of the property and the agreed-upon purchase price. This can be a powerful tool in a competitive market because it shows the seller that the buyer is committed to the sale and is willing to pay more than the appraised value.
- Use an escalation clause: An escalation clause is a clause in the purchase offer that states that the buyer will increase their offer by a certain amount, up to a specified limit, if there are other competing offers. This can be an effective way to outbid other buyers without overpaying for the property.
- Offer a larger earnest money deposit: A larger earnest money deposit can show the seller that the buyer is serious about the sale and has the financial resources to follow through with the purchase.
- Offer non-refundable earnest money after inspection: By offering non-refundable earnest money after the inspection, the buyer can show the seller that they are willing to take on the risk of any repairs that might be needed.
- Consider waiving the inspection: Waiving the inspection can make the offer more attractive to the seller, but it also comes with risks. Buyers should only waive the inspection if they are confident in the condition of the property and are willing to take on any repairs that may be needed.
- Consider offering cash if possible: Cash offers can be very appealing to sellers because they eliminate the risk of financing falling through.
- Use a local lender: A local lender can help speed up the financing process and provide more personalized service, which can be a selling point for the seller. This makes the seller more comfortable thinking that the buyer is using someone that is actually here in Alaska.
- Offer to pay the seller’s closing costs: Paying the seller’s closing costs can make the offer more attractive and can help offset any concerns the seller may have about the offer price.
- Make an offer higher than the asking price: Making an offer that is higher than the asking price can be a powerful way to win a bidding war. Buyers should not overpay for a property if they are planning to make another move in the near future. If you are planning to live in the home for an extended period of time…say more than 10 years you will be able to justify the increased price you pay now over that longer period of time.
- Use a real estate professional. Not only can you receive help in knowing when and how to use the strategies above, you will increase the chances that your offer will be accepted. In a competitive market place, a seller is usually nervous about an offer coming from an unrepresented buyer.
If you want to WIN the next time you find the home of your dreams contact someone here at Valley Market Real Estate. We have the experience to guide you through the process.