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Q: What Tips Should Buyers in This Seller’s Market Follow?
Dated: September 23 2020
If you’re planning to buy in this market, here are five tips to help you find success.
If you want to buy, many factors work in your favor right now, but there are also challenges, given that it’s a seller’s market. Sellers are receiving multiple offers, many of which are above their asking price.
So what can buyers do during this time? Here are five tips I share with my clients:
1. Be decisive. Time is critical in these situations, and sometimes getting the home of your dreams means simply being the first to it. If you want to see a home that goes on the market, don’t wait until the weekend. Schedule a showing that day or the next, or request a virtual showing.
2. Submit a clean offer. During a seller’s market, it’s not the best idea to submit an offer with contingencies. A heavily contingent offer will likely look weaker in the seller’s eyes. They might be interested in finishing things up quicker rather than getting a higher price.
3. Let go of perfection. Inventory is limited and demand is high, which makes it even less likely you’ll find the perfect home. That’s okay—sometimes it’s better to buy a home and make it perfect rather than waiting for perfection to hit the market. There’s a strong chance that when inventory increases, you still won’t find the perfect home.
4. Be disciplined with your budget. While bidding wars are possible, things can get pretty competitive between buyers, so it’s easy to get carried away. You may become so attached to a home that you’re willing to go beyond your budget. To prevent this, set a budget and don’t let yourself exceed it no matter what other offers look like. Offering more money may get you the house, but it will cause you more financial stress for years to come.
5. Offer more earnest money. Earnest money is something like a deposit, and you provide it alongside your offer. It’s a way to show the seller you’re serious, but if the deal doesn’t go through, you can get the money back. Usually, you’ll see buyers offer around 1%, but in a hot market, think about offering more. It shows the seller that you’re more invested in the deal. If you do have the option to pay with cash, that’s almost always going to work in your favor. A cash offer takes out the financing contingency, which makes the transaction much smoother.
If you have any questions about purchasing a home in today’s market or real estate in general, don’t hesitate to reach out to us. We’d love to help you.
As a licensed real estate professional in Minnesota and Wisconsin and a nation-wide referral community. I provide much value to facilitating real estate transactions with focus in the luxury and reloc....
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