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5 Tips For Making An Offer On Your Next Home
Dated: September 20 2021
5 Tips for Making An Offer On Your Next Home
In today’s sellers’ market, standing out as a home buyer is critical. Multiple offer scenarios and bidding wars are the norm due to the low supply of houses for sale in the Tampa Bay area and high buyer demand. If you’re planning on buying a home this fall, you’ll want every advantage, especially when you’ve found the home of your dreams.
Below are five things to keep in mind when it’s time to make an offer:
1. Know Your Budget and Get Pre-Approved
Knowing your budget and what you can afford right from the start is critical to your success as a homebuyer. The best way to understand your numbers is to work with a lender so you can get pre-approved for a loan up front. As Freddie Mac puts it:
“This pre-approval allows you to look for a home with greater confidence and demonstrates to the seller that you are a serious buyer.”
Showing sellers you're serious includes submitting offers with a bona-fide pre-approval letter or proof of funds (if purchasing with cash only) when the offer is sent over. Never send over an offer without these key items if you don't want it to get overlooked.
2. Be Prepared To Move Quickly When You Find a Home You Love
The speed and the pace of home sales are contributing factors to today’s competitive housing market. According to the latest Existing Home Sales Report from the National Association of Realtors (NAR), the average home in Pinellas County, Florida is on the market for just 7 days. As the report notes:
“Eighty-nine percent of homes sold in July 2021 were on the market for less than a month.”
When homes are selling fast, staying on top of the housing market and moving quickly are key. After you’ve worked with your real estate agent to find the home that suits your needs, they’ll help you put together and submit your best offer as soon as possible. Your agent should also be reaching out to listing agents to find out when offers will be reviewed and how much time you have to see a property before offers are submitted.
3. A Top Real Estate Professional Can Lead You to Success
No matter what the Tampa Bay housing market looks like, rely on a trusted real estate advisor (like us!). As Freddie Mac says:
“The success of your homebuying journey largely depends on the company you keep. . . . be sure to select experienced, trusted professionals who will help you make informed decisions and avoid any pitfalls.”
Top Real Estate Agents are experts in the local real estate market they work in. They have insight into what's worked for other buyers in your area and what sellers may be looking for in an offer. It may seem simple, but catering to what a seller may need can help your offer stand out. A great real estate agent will reach out to the listing agent in advance and try to find out if there are any 'motivating factors' that might make your offer more enticing for a seller. Sometime this could be a faster (or longer) closing timeframe, a shorter inspection period, or agreeing to let the seller leave behind furnishings and other items that might be tricky for them to use in their next home. You never know what a seller might consider valuable in an offer, so it's best to have your Realtor ask in advance for any insights.
4. Craft a Strong, Fair Offer From the Start
In the past, offering at or near the asking price was enough to make an offer on a home appealing to sellers. In today’s housing market, that’s often not the case. According to the latest Realtors Confidence Index from NAR, "50% of offers are above the list price."
In such a competitive real estate market, emotions and prices can run high. Having an experienced agent to help you craft a strong, fair offer is critical in these situations. Your agent can help you understand:
The market value of the home based on recent nearby home sales (For similar properties)
Recent sales trends in the area (aka How much are homes selling for vs the original list price?)
Current buyer demand (How fast are homes selling once they hit the market in that area?)
5. Understand the Seller’s Needs, But Resist Waiving Certain Contingencies
When crafting an offer, you’ll want to keep both your best interest and the interest of the seller in mind. Your trusted real estate advisor will help you consider which levers you could pull, including contract contingencies (conditions you set that the seller must meet for the purchase to be finalized). Of course, there are certain contingencies you don’t want to give up, like the home inspection. In florida, in order to get insurance on a home, you'll need a 4-point inspection and wind mitigation inspection for most homes. If you waive the right to inspections and have a loan as well, you might be in a pinch when it comes time to provide this info to the insurance company to get a policy. Not sure what this means? Your experienced real estate agent will be able to explain further.
Freddie Mac explains:
“Resist the temptation to waive the inspection contingency, especially in a hot market or if the home is being sold ‘as-is’, which means the seller won’t pay for repairs. Without an inspection contingency, you could be stuck with a contract on a house you can’t afford to fix.”
Today’s competitive Tampa Bay housing market makes it more important than ever to make a strong offer on a home. Connect with us to make sure your offer rises to the top when you find that dream home!
Mary Frances has over 20 years of experience working exclusively as a Buyer's Agent in Pinellas County, FL, and the Greater Tampa Bay area. She has a comprehensive understanding of the Pinellas County....
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