Structuring a winning offer in a seller’s market

Structuring a winning offer in a seller's market

As most buyers are finding out, even up to the million-dollar range, quality inventory is low and competition for the best properties is often fierce.

Here are a few tips to making your offer the one that’s accepted.

1. Work with an accomplished agent that’s well-liked by area listing agents. Relationships matter and a listing agent wants to work with another agent they’ve had a positive experience with. One that is poised and upbeat and always trying for solutions that help get to settlement. Not a fighter or one where every interaction is negative.

2. Have a very strong approval letter. Not a weak pre-approval that makes it seem like the lender hasn’t even met the buyer. Very important in helping a purchaser come across as solid.

3. If possible, come up with a noticeably larger than usual earnest money deposit. One percent is average. Do two percent or more…it shows seriousness and confidence.

4. Closing cost assistance. If you have to have it…ask for it, but keep it as small as possible. When competing, remember sellers and good agents are smart. An offer of $500,000 with $10,000 in seller subsidy is really an offer of $490,000.

5. Same goes for warranty policies. When competing, this should be the first thing to drop off. While it’s a valuable add-on, the cost isn’t enough to lose a dream house over.

6. Waiving the appraisal is a super-eye catching thing to make the offer stand out, but can be risky. Especially if an escalation addendum is involved. If considering, make sure you are putting a lot of money down and that your pricing is correct.

7. We don’t like waiving home inspections. We’re seeing a lot of “void only” inspections where the buyer says “we’re going to have an inspection, but we won’t ask for anything to be fixed. We’ll either void the contract if there is a big important problem, or purchase the home without repairs if there is not.” This can be attractive.

8. Make sure your agent is like an investigator, and can use finesse to probe to find out the sellers highest concerns. Settlement date, not wanting to address inspection issues, needing a rent-back, taking a hot tub or chandelier, etc. Being able to make your offer help solve a seller’s needs or anxieties can be a successful strategy. We’ve often seen a contract with a lower sales price win the day.

These are just some of the tactics we use. If you have any questions or want more information, give us a call at 703-822-0207. We’d love to help you.

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