Home Buyers Can Face Multiple Offers!
We are moving into the spring market and things are starting to pick up for home sellers and home buyers. There is currently still a lack of inventory on the market, making it more competitive for home buyers to make an offer an the home that they want to purchase. Just this past week, I wrote an offer for my home buyers and within 12 hours, we heard from the seller that there were multiple offers. The seller utlimately went with the highest and best offer.
If you're a home buyer in the $100,000 to $250,000 range, you are already at a handicap, since you will be bidding against investors, who can normally pay cash for homes in this price range. Cash isn't always king, but if your neck and neck in a bidding war, it does give the investor the upper hand.
What Are Some Things Home Buyers Can Do?
Sellers love bidding wars and will welcome them, in hopes that the bids will go over the list price, and they can net more money. As a home buyer they can be frustrating. Especially if you keep getting out bid several times, on homes that you written offers on.
Bidding wars add an extra layer of complexity to an already complex and sometime overwhelming process. As a home buyer this is where hiring an experienced MDREPros Professional Buyers agent with superior negoiation skilles can make all of the difference! Here are some things you can think about when you are making an offer, that might help them stand out and be more appealing to home sellers.
Build A Relationship:
This doesn't always help, but it can't hurt. Sometimes offering the most money isn't the most important thing to the home seller. They might be more concerend with someone taking care of this place that they love and have called home. As a home buyer you can write a personal letter to the seller and explain how much you and your loved ones like their home, and how much it would mean to you all if this was your new home. Sometimes, this can give you a slight edge over the competiton. You could even include a picture of you and your loved ones, so the home seller can see the "faces" behind the bid.
Other Ideas to help home buyers win a bidding war!
We haven't seen a lot of escalation clauses lately, but they will be making a comeback soon. You can have your Maryland Real Estate Professional Realtor add this addendum to the offer you are writing. Let's say you make an offer of $200,000 for a home (But you know that you are willing to go up to $220,000). The esculation clause could be a simple as saying you will go $1,000 over the highest bidder... all the way up to $220,000. So if the highest offer that comes in is $211,000, you would automatically offer $212,000. This could potentially save you $8,000 on your home, and win you the bid. Be aware, not all sellers will accept an escalation clause. (i.e. bank owned properties, short sales, etc...) So be sure and discuss with your Realtor and see if this is a good option for you.
Most offers on homes involve alot of contingencies. Before you ask your Realtor to add every contingency in the book in the offer, see what their expert opinion is on what to include and what can be excluded in writing an offer. Alot of contingencies can be wrapped into the home inspection, it just might take some well timed planning and quick scheduling. Sellers want to see the minimal number of contingencies when they are looking at and comparing offers.
An Experienced Realtor CAn Save Your Thousands
As you can see, there are a lot of things to consider when making an offer on a home. And this is only the tip of the iceberg. As a home buyer want to make sure the Realtor you are using has the experience and knowledge on how to negoiate the best deal on your behalf and to be able to out negoiate the other home buyers realtors.
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Have a Great Week!!