Strategies for getting your offer accepted in a Seller’s Market You are ready to take the plunge and put in an offer on your dream home. You found something that is perfect for you
Strategies for getting your offer accepted in a Seller’s Market
Dated: March 17 2021
Strategies for getting your offer accepted in a Seller’s Market
You are ready to take the plunge and put in an offer on your dream home. You found something that is perfect for you and you are willing to pay the asking price. It’s a sure thing? Not so fast.
A seller’s market means that there are more buyers than there are homes available for sale. It may mean that your full price offer just is not going to cut it. So, what can you do to get the seller’s attention to your offer!
MAKE YOUR OFFER AS CLEAN AS POSSIBLE
A Clean offer should not be contingent on the sale of another property or have other financial constraints. It should also be free of asking the seller to help with your closing cost. The main contingencies in an offer are the loan, appraisal, and inspection contingencies. As you are planning your offer and how it can look more attractive to a seller, consider removing these contingency’s. The fewer contingencies you have in the offer the more appealing your offer becomes. You can protect yourself on the loan contingency by obtaining a loan fully underwritten prior to submitting an offer. This means that you will complete the entire loan process with your lender before making an offer on a home. Then when you put an offer in you can confidently eliminate your loan contingency with little or no risk.
You may also want to consider giving up your inspection contingency. If the seller has provided inspection reports from reputable companies, then you can do this with little risk.
AVOID ASKING FOR PERSONAL PROPERTY
Love that lawn mower in the garage? Skip it. Your offer could be very similar in price to another offer that isn’t asking for items that belong to the seller. Asking for items that are excluded from the sale could weaken your offer.
If you really want that lawn mower or deck furniture, let’s ask after you are under contract if they would like to leave it. If not, Home Depot is more than likely right around the corner. Remember, if you want to seriously compete for and win the bid on this house, it is important for you to remain focused in achieving your goal: buying the house, and hope your competition falls in love with the lawn mower.
WRITE A PERSONAL LETTER TO THE SELLER
An easy way to increase your odds of getting your offer accepted is to write a personal letter to the seller. I have seen this work many times! The seller’s agent will tell me “My seller just loved your buyers’ letter, they feel so much better knowing they are leaving the home to someone who loves it”. While some sellers only care about the price, others are emotionally attached to their homes and want to make sure it will be in good hands.
If a seller has lived in their home for many ears, it may put them at ease to know someone who cares is moving in. By including a letter that tells the seller a little bit about yourself, why you love the house, and why you want to make it your home, you can make the difference in closing bidding situations. See an example of a letter we just recently presented to a seller along with the buyers offer. Offer was accepted!
Dear Sellers of our dream home on XX Lane,
A bit about us... We are beach born and raised. The Outer Banks holds our hearts in a special way. As children we would frequent the area on vacations and as adults we even decided to get married there! When you know a place is home, you just KNOW... The Outer Banks is where we are meant to be. However, due to my husbands profession we have been stuck in the beautiful mountains of Idaho and CANNOT WAIT to get to the ocean again. The way the world is today allows remote work schedules so we can get back to the beach! Our family consists of two high school best friends turned married couple, our three children and two kitty cats. We work hard, love hard and play hard. Your home would be full of laughter and warmth so long that we are in it. I can not begin to explain in words how much joy we would have living there.
We look forward to your decision on this home sale.
We are not in a market for making low offers and hoping a seller will respond favorability. Your offer needs to be strong enough to beat out a multiple offer situation. If you want the house, you’re likely going to have to go above the ask price. Doing this will show the seller that you are serious about buying their home, and that you want them to consider you as a potential buyer.
PUT DOWN A STRONGER DUE DILIGENCE FEE & EARNEST MONEY DEPOSIT
There is a difference between a DUE DILIGENCE FEE & EARNEST MONEY. Due Diligence money goes directly to the seller once you are under contract. Whether you have contingencies in the contract or not, this money will not be recovered. Offering Due Diligence money in this market has become very popular. I have seen DD checks anywhere from $1,500 to $20,000. And I’m sure I will see them even higher as the year goes on. Earnest money (EMD) is money that is protected until you are through your Due Diligence period (which is the number of days we have asked for in the contract to conduct your inspections, appraisals & loan contingencies). If you remove those contingencies to make your offer more appealing to the seller, earnest money deposit is treated basically as a due diligence fee with the exception that it does not go to the seller until the home closes or buyer terminates. If you are putting a substantial amount of DD & EMD money down, make sure you intend to buy the home. If you do not end up moving forward with the purchase, your EMD may be in jeopardy.
WAIVE THE APPRAISAL CONTINGENCY
An appraisal contingency can be given up as well – but, this poses the most risk unless you have enough cash to cover any potential shortfall between offered price and the appraised price.
This is a huge one! An offer indicating your intention to bring money to the table if the home doesn’t appraise will definitely set you apart from the others. Just make sure you are in a strong financial position to take the risk.
PAY WITH CASH
Cash offers also have the important effect of keeping the deal primarily between the buyer and seller; they call the shots and not some stranger at a bank. A financed deal is usually subject to financing contingencies, which leaves a back door for the buyer to exit.”
Dealing with Cash offers proves that a buyer is serious and has the financial means to expedite closing quickly.
OFFER A WEEK OF FREE WEEK IN THE HOME DURING THE SPRING TO FALL OBX SEASON.
When purchasing a home with a mortgage, your payment isn’t due until a month after you close. Why not offer your payment early to sweeten the deal? Offer them a spring/summer or fall week.
THE BOTTOM LINE HERE…
While they may seem small, these things can go a long way to making your offer stand out and get you the home of your dreams. Establishing that you are a serious buyer, with the financial capabilities to meet all obligations, is the way to a seller’s heart. Be willing to go the extra mile, both in your intention and in your financial offerings. If you do so, the seller of your dream home will notice your effort and give your offer a second glance.
NOW LET’S GO GET THAT HOUSE!
Kathleen relocated to the Outer Banks of North Carolina with her husband and three children from the Philadelphia and Stone Harbor, NJ areas. One of her greatest pleasures is introducing people to the....
Latest Blog Posts
Update from the Virginia Pilot: Part of Outer Banks to reopen Thursday to nonresident property owners, next month to visitorsCurrituck County plans to reopen Corolla to nonresident property