9 Ways to Stand out as a Buyer in a Seller's Market2/26/2021
No doubt about it, it’s a seller’s market right now. COVID-19 has caused many homeowners to downsize. Others have shifted to working from home, and choose to relocate since they don’t have to stay close to their employer. Throw into the mix record-breaking low interest rates and a low inventory of available homes, and selling your home has never been easier. Sales are up nearly 24% compared to this time last year.
But if you’re shopping on the other hand, it’s a different story. But the stiff competition doesn’t mean you’re out of the game. Follow the 9 steps below to stand out to sellers and give your offer a fighting chance.
- Get pre-approved. Do NOT contact a sellers’ agent or look for a realtor of your own without getting pre-approved first. With the incredibly low inventory of houses right now, don’t think you can kick the tires and still land your dream home. With Michigan homes selling within 6 hours of listing, you need to come to play. Submit your pre-approval and proof of funds documentation with your offer.
- Do your research. Before you even pick up the phone, you need to know what’s important to you - school district, neighborhood, property taxes, distance from work... and if the home you’re viewing fit your needs. There’s no time to start Googling after viewing a house and falling in love with it.
- Automatically assume you’re competing against several other offers. Now this doesn’t mean jump on a property that doesn’t have what’s important to you, or offer cash if you can’t deliver, or ignore your gut and waive contingencies when you’re not comfortable. It just means that you can’t dawdle, and that this is not the time to play hardball.
- Increase your earnest deposit. Your earnest money deposit proves that you’re a good-faith buyer. Deposits are about 1% – 3% of the price of the home. If you put a larger amount down, it may show that you are a serious buyer and that your intentions are genuine. But don’t put more down just to “hold your place in line,” because depending on what has been signed at this point, the seller could end up keeping that money if you walk away.
- Offer a faster closing. 45 days can seem like a lifetime when selling a house, and offering a shorter wait can ease a seller's mind, especially if they’re working to sell their current home before buying their new one. Helping them to close one mortgage before taking on the responsibility of another can make your offer look exceptional.
- Speed up the home inspection. Though time constraints can vary, 10 days is a common timeframe in which buyers in the state of Michigan must complete their home inspection. Don’t wait till the last minute! You may be at the mercy of the inspectors pre-booked schedule, but reaching out before submitting an offer, or scheduling the inspection as soon as possible can indeed cut several days off the waiting game.
- Make your first offer the strongest. In a seller’s market, buyers don’t have the luxury of low balling and assuming the seller will come back with a counter offer. You don’t have to offer over listing price, but make it fair and make it count. Putting your best foot forward, both in terms of money and offering some other items on this list, go a long way in getting a seller’s attention, and hopefully, their business.
- Write a letter (but first make sure it’s allowed in your area). A short, personal note to the seller, explaining what you love about their home and how you hope to enjoy certain features, can tug at their heart strings and create a connection that extends beyond dollar signs. Check out this blog for tips on writing the perfect letter.
- Offer a lease back. If you’re able to, give a seller a little breathing room between selling their old home and buying their new one, and you just may close on your dream home. Moving is a time-consuming and stressful process, and allowing a seller to stay in the already-sold home, whether for a few days or even a month, can sway them from choosing a higher paying offer.