Resilient demand for houses in Waukesha County, especially priced below $350,000, has created a tough environment for buyers in 2020. With demand outweighing the available supply of homes, multiple offers on properties has become common.
To help your offer stand out from the crowd, below are some things to consider. Since all situations are different, the strategies you employ will be determined by the level of competition, the type and condition of the property, your level of motivation, and other factors.
WRITE A PERSONAL LETTER.
Composing a personalized letter to the seller is your chance to make yourself memorable, explain why their house would be perfect for you, and persuade the seller to accept your offer. Find a connection between you and the seller and fit it in your letter. Include a family photo, especially if you have cute kids or pets, to help the seller visualize you and your family living there.
BE FLEXIBLE ON CLOSING.
To make your offer more appealing to the seller, be flexible on closing and communicate that in your personal letter. If the home is vacant, you could propose to close quickly. If a seller recently listed and is still occupying the property, you could extend the courtesy to push back the closing date or offer a rent-back option which may give them a sense of relief.
AVOID CONTRADICTING THE INCLUSIONS AND EXCLUSIONS DISCLOSED.
When writing an offer, match the inclusions and exclusions (commonly appliances and fixtures) outlined in the listing. Going against what the seller wants to include or exclude in the sale can turn them off, as it could dig into their profits or create complications on their end.
After acceptance of your offer, you could always ask your realtor to check-in and see if the seller is open to negotiation about the inclusions and exclusions.
DON’T ASK THE SELLER TO INCLUDE A HOME WARRANTY.
Instead, ask us! Receive a FREE, one-year home warranty when you purchase a home with Oconomowoc Realty. Up to a $500 value! This promotion expires December 31, 2020. Chances are, a seller would move on to the next buyer’s offer that did not ask for a home warranty, in order to make the most profit as possible on the sale of their home.
GET PRE-APPROVED FOR A MORTGAGE FROM A LOCAL LENDER.
A pre-approval from a local, reputable lender can give sellers more confidence that you can obtain financing.
SUBMIT YOUR PRE-APPROVAL LETTER WITH THE OFFER.
If a seller receives multiple offers on their home, they may ignore offers that are contingent on financing but do not include a mortgage pre-approval letter.
DON’T MAKE YOUR OFFER CONTINGENT ON THE SALE OF YOUR CURRENT HOME.
The uncertainty of selling your current home could scare sellers. If the seller does accept your offer with this contingency, a bump clause will typically be included in the contract. This clause allows the seller to “bump” the original offer (yours), if they receive a better offer.
GIVE THE SELLER THE RIGHT TO CURE.
Offering the seller the right to cure any defect(s) your home inspector may find, that you object to, will give them the option to cure the defect(s). This will give the seller more confidence that you will not back out of the deal.
OFFER MORE EARNEST MONEY.
Typically, within 5 days of an accepted offer, a buyer must put down earnest money (1-2% of purchase price). Putting a bigger deposit down can help show that you are a serious buyer.
GET IN FRONT OF THE LINE.
In the current fast paced market, make an offer quickly on the home you like, to get your offer on top of the pile.
MAKE AN ALL CASH OFFER.
If you can prove you have sufficient funds, you could consider making an all cash offer. After your offer is accepted, you could decide to finance with a mortgage instead. Showing you have available funds will build the seller’s confidence that you can afford to purchase.
SKIP THE RADON INSPECTION.
Homes in Oconomowoc and Waukesha County are suspect to high radon levels, according to the Wisconsin Department of Health Services. While radon inspections are recommended, you may choose to leave out this contingency in a highly competitive market.
After closing on a home, you could have your own radon inspection and install a radon mitigation system if needed. The sacrifice could make the difference in getting the winning offer or not.
SHORTEN CONTINGENCY DEADLINES.
Discuss with your realtor about the appropriate deadlines for the contingencies in your offer.
INCLUDE AN ESCALATION CLAUSE.
This clause allows you to disclose to a seller that you are willing to increase the amount offered, if another buyer makes a higher offer than your original.
OFFER TO PAY THE SELLER’S CLOSING COSTS.
To appeal to a seller’s finances, you could offer to pay some or all of their closing costs.
Often, sellers will consider the offer as a whole, not just the offer price, to make their decision. Our team of realtors can discuss what options would be recommended for your unique situation, and help you craft a great offer.
As mentioned earlier, the best offer strategies to implement will vary depending on each individual circumstance and factors involved. These pointers are proposed for a highly competitive buyer market. This blog is not intended to be legal advice and you should consult with your realtor or attorney about your options when writing an offer.