Buying a home will always come with its challenges, but buying in a seller’s market brings a whole new level of difficulty. Competition and price for the most desirable homes runs high, and that can quickly lead to disappointment. Do not be discouraged though. Listed below are six tips for buying in a seller’s market that if followed would place you in the best position possible to successfully buy a home even when the market doesn’t favor you.
Start the Process ASAP
Listings in popular neighborhoods will not be on the market for long, especially in a seller’s market. In a seller’s market time is of the essence. Being quick about seizing an opportunity will be one of the best strategies for you to implement.
If you have your heart set on buying in a specific neighborhood or community then you need to be on the lookout for a property as soon as possible. Start your house hunt early, and have patience. So when a golden opportunity finally presents itself you will be ready to jump on it.
When a home you are interested in is listed, you should quickly find out as much information as you can about it. Property reports, disclosures, and offer due dates are just a few things that you should be looking for. Instead of waiting for the seller to provide this information after you express interest, go searching on your own. Having background information about the property before negotiations start will expedite the process. Hopefully allowing you to secure the home before more buyers discover it.
Speed is the name of the game when you are buying in a seller’s market. In order to be prepared to make an offer within a day or two of finding a home, you will need to have all your supplemental paperwork ready to go. Meaning that you will want to be preapproved for your mortgage. As well as be able to show proof of funds for the down payment.
Having these crucial steps taken care of before you even submit an offer allows you to be ahead of the game. In a multiple offer situation being preapproved will make you a more attractive buyer. You will be able to offer the option to close quickly with little hassle. In many cases that is an offer that sellers won’t be able to pass up.
Invest in a Top-Notch Real Estate Agent
When buying in a seller’s market, hiring a real estate agent will give you a serious advantage. You should seek out an agent who has a great track record for closing deals efficiently. In addition to having a reputation of being on top of listings as soon as they hit the market. An experienced, and responsive agent will give you the competitive edge you need to be successful in a seller’s market.
Reach out to your friends and family to see if they have any recommendations to make for someone who fits the bill. It is also a good idea to investigate online reviews of agents you are considering. Reviews posted on Google, Zillow, or Homes.com would be a good starting point for your research.
Hiring an excellent agent is a tip for buying in a seller’s market that may be costly, but will quickly prove to be worth it.
Make Your Offer Stand Out
In a multiple offer situation, which you should assume is the case, you want your offer to be as attractive as possible. Listed below are a few things you can do to ensure that.
- Offer to put down a large deposit.
- Include earnest money with your bid. Earnest money is a deposit that you submit with your initial bid to show the seller how serious you are. Oftentimes earnest money is around 1% of the price of the property. You can always submit a higher percentage though, and should certainly consider that if you really want a certain home. Putting down money before you have a contact could easily become stressful though. So talk to your agent and ensure the earnest money is refundable if the deal were to fall through.
- Offer to be flexible with the closing date. Trying to accommodate to the seller’s schedule will show your level of interest, and willingness to make the process easier for the seller. Two things that are sure to grab their attention.
Ditch Your List of Demands
Ditching your list of demands is a tip for buying in a seller’s market that definitely should be taken. When buying in a seller’s market it is important to think twice before adding any attachments to your offer that would discourage the seller.
You have relatively little power in a seller’s market. So when a seller sees an offer filled with demands or contingency clauses they will simply move on to the next offer. Truly consider what demands are essential to you, and which are not. Eliminating as much as possible from your offer that makes it unattractive will benefit you in the long run, by allowing you to successfully secure a home in a very difficult market scenario.