It is still a seller’s market in real estate as we move into spring of 2022 and the competition for homes is likely to get even more fierce. If you are looking to purchase a home right now, chances are you may find yourself competing with many other potential buyers. Be prepared!
Here are five ways to be a competitive home buyer:
- GET YOUR FINANCES IN ORDER
Now would be a good time to get as much cash as you can. It is never too soon to get pre-approved for a loan. In fact, the sooner the better. Sellers will have lots of options and will be leery of those who do not have loans set in stone. If possible, bring cash to the table. Sellers will fear appraisals coming in low and loans falling through, so be prepared to cover the difference with cash. How to Get a Mortgage Preapproval
- DON’T HESITATE
Be the first to make an offer and make it a good one. An insulting offer will put you at the bottom of the seller’s list, so it is not a good time to low ball. Come in at or slightly below asking price so that they know you are serious about purchasing their home.
- ESCALATION CLAUSE
This is the amount of money the buyer agrees to increase the offer if there are other bids. If you offer the asking price of $400,000 on a house, but it might sell for $450,000, put in an escalation clause stating that you are willing to go as high as $460,000. But know your limit. Don’t offer more than you can handle. Also, make sure the clause states that the seller can only take the winning bid up to a level just above the competing offers. For example, if an offer comes in for $430,000, your bid would be upped to $431,000.
What is an Escalation Clause in Real Estate and When Should You Use One?
- GET A PRE-INSPECTION
It will cost you a few hundred dollars, but it can help you in a super-tight market. If you can make a bid that is not contingent upon inspection, sellers will look favorably on your offer versus the same offer from someone who has a contingency in their contract.
- THINK WITH YOUR HEAD, NOT WITH YOUR HEART
Be smart! Purchasing a home can bring out your emotions, but emotions can get in the way of making wise decisions. Make sure you have done thorough research of the market: look at the most recent comparable sales, compare prices from a year ago, visit local schools, have coffee at the closest café and speak to potential neighbors. Look at listings nearby. Whatever you do, don’t overpay because you get caught up in the heat of the competition. While the house may seem perfect for you, it is not the only house that will be perfect for you. So, keep a level head and make intelligent decisions.
Are you thinking of buying a home or selling your current home in New River Valley, VA? Then it is time to contact Desi Sowers, your New River Valley, VA real estate resource! Give her a call today at 540-320-1328!
Photo Credits: blog.rismedia.com, forbes.com, homes.com