So, you've found your dream home and you're ready to make an offer.
In today's housing market, we hear the word "competitive" thrown around plenty. When a home is priced right (and sometimes even when it isn't), multiple Buyers become interested in the same property. Depending on where you are looking, there may be a shortage of inventory. There is no doubt, if you see greatness in a home- there is a good chance someone else does too.
SO HOW DO YOU BETTER YOUR CHANCES TO "WIN?"
This is the advice I share with my clients:
Get Pre Approved. Having a Lender write you or the Homeowner a letter explaining that you are pre-approved for a mortgage, and that there won't be any 'hiccups' if the Seller will move forward with you. Sellers need the peace of mind to know that a Buyer is not only pre-qualified, but also pre-approved by the Lender or the bank to ensure a smooth closing date. A savvy seller, or his/her real estate agent, won't give your offer a second glance without this, especially when there are all cash offers involved. If you want to show even more proof of qualifying, you can include a bank statement with your name (you can cross out any other personal information) showing that you have the funds for the downpayment!
Side note - Get started early on the Pre-Approval process... Try not to wait until you actually find a home you want to buy! As soon as you start thinking about potentially making a purchase, reach out for referrals, visit your local banks, and shop various rates online.
Run the Comps. Get to know the neighborhood you are looking in. Pay close attention to the market. Visit similar homes in the area and work with a professional real estate agent that can help you find comparable properties and determine the value of a home. Your best bet is to have a real estate professional assist you with home valuations, as third party websites and computer-generated estimates are often skewed and can't tell the difference between a tear down and a newly constructed home!
Shorten Your Contingencies. There are several contingencies that are worked into an offer, such as inspection times, loan, and appraisal. Work with your real estate agent to find out what a realistic timeline would be to complete these so you can help keep you offer competitive. Ask the Listing Agent what the Seller is looking for. (i.e., has the Seller already found a replacement property and if not, would they want a Buyer to cooperate with their timeframe)
Leave Just a Little Room to Negotiate. No matter how great your offer is, (in California), the Seller does not necessarily have to respond to your offer, or send you or any other prospective Buyers a Counter Offer. Put your best foot forward, with just a little 'wiggle' room. Don't overextend yourself in terms of pricing or contingencies, that you might come to regret later.
Write an offer letter. Yep! Write an authentic letter to the Seller. Tell them what you love about the house, and why you want to live there. Share your story, attach it to the offer and ask the Listing Agent to include it as part of the offer. An offer letter gives you an opportunity to bond and have a personal connection, amongst a stack of paperwork!
Choose Your Agent Wisely. It can only help you if the Agent you are working with has a good reputation following them. Try to work with an agent that knows Sellers or other Brokers in the neighborhood that could provide referrals. People like working with people they like!
If you have any other questions about buying or selling a home in California, feel free to