Buying in a Hot Market
By Diane Kelly
Jul 29, 2006, 13:28
A red-hot housing market is good news for the seller, while buyers often find their choices are limited. When demand is higher than supply, the result can even be "bidding wars" on the few attractive, well priced homes on the market. However, as a professional realtor, I can tell you, there are several tips to keep in mind that can help you make a successful buy.
When you're ready to buy a home, get your finances in order, and that means long before you're ready to prepare an offer. Get pre-approved for loans and mortgages. We can help you in this process. Having one less condition on your offer, and going into negotiations with a pre-approved mortgage, shows you're a stable, dependable buyer and makes your offer very appealing. Especially if your competition isn't so well prepared!
When the time comes to prepare an offer, make your best offer your first offer. In a hot market prices are rising rapidly, and new buyers can enter the picture at any time, so it's to your advantage to keep counter-offers to a minimum. I will let the sellers know that you are going in with your best offer. That will start proceedings on a positive note, and may offer the sellers some added incentive to strike a deal while keeping further negotiations to a minimum.
Another way to make your offer to purchase appealing is by accommodating the seller's terms as much as possible. For example, if the seller wants a different closing date than you'd prefer, measure its importance against the value of presenting a clean offer, with little in it for the seller to object to. You may be surprised to learn that what may be a minor consideration to you has great importance to the seller. It's particularly important when you remember that if any aspect of an offer is rejected or revised, then the whole offer is refused. That means everything can come back up for negotiation again, including the price.
If you already own a home, another major step you can take to keep your offer clean, simple and attractive is to eliminate the condition of selling your existing home. You can do this either by selling your existing home before you buy, or by taking the more risky option of assuming it will sell quickly in the current hot market conditions. This latter option may end up costing you some money in terms of bridge financing if you don't sell as quickly as you think you will. That may be an acceptable risk to you, but make sure you have all your facts before you decide. As real estate professionals we can counsel you on the pros and cons of each option, to help you make an informed decision.
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