Today’s homebuyers are faced with a strong sellers’ market, which means there are a lot of active buyers competing for a relatively low number of available homes. As a result, it’s essential to understand how to make a competitive offer on a home. Here are five tips for success in this critical stage of the homebuying process.
Understand Your Finances: Have a complete understanding of your budget and how much house you can afford. The best way to know this is to get pre-qualified for a loan early in the homebuying process. Roughly 44% of today’s prospective homebuyers are planning to apply for pre-approval, so be sure to take this step early so you’re ready to go when submitting an offer. Doing so makes it clear to sellers you’re a serious and qualified buyer – which can give you a competitive edge in a bidding war.
Listen to Your Realtor: From the start, your Realtor is a trusted and educated professional and can help you stay focused on the most important things. Remember to let your Realtor guide you on the home-buying journey, not your emotions. Their expertise will keep you from compromising on your must-haves and your future financial stability. Your real estate professional should be your guide you lean on when you’re ready to make an offer.
Be Prepared to Move Quickly: According to the National Association of Realtors (NAR), the average property sold today receives 3.7 offers and is on the market for less than 21 days. In today’s market, it is important to stay agile and alert in your search and be prepared to submit an offer as quickly as possible.
Make a Fair and Strong Offer: It’s only natural to want the best deal you can get on a home. However, submitting an offer that’s too low can lead sellers to doubt how serious you are as a buyer. This is where the expertise of your Realtor can assist you in the process that will help you stay competitive.
Stay Flexible: After submitting an offer, the seller can accept, reject or counter your offer with their own changes. It’s important to stay nimble throughout this process. You can strengthen your position with a stronger offer that includes flexible move-in dates, a higher price, a higher down payment or minimal contingencies. However, do resist the temptation to waive the inspection contingency. Without this contingency, you could be stuck with a contract on a house you can’t afford to fix.