Despite what the current real estate market conditions may be there can be multiple offers on a property for sale at any time. In today’s real estate market the buyer demand is still far exceeding the lack of supply for many types of properties. This poses the question of how can you make your offer more competitive? Here are some helpful tactics to consider.
Appraisal gap coverage
If you are in a competitive bidding situation where you offer more money than the asking price, that can be problematic when it comes time for the home to get appraised. What if your offer exceeds the home appraisal value and you intend on financing the home? In this case you can offer “appraisal gap coverage” as a potential remedy. Basically you can offer to pay any overage of the appraisal value in cash if you are able.
The amount of your deposit is also an indication of your level of commitment to buying the home in the seller’s eyes. There may be some ways out of the deal should there be issues with the home inspection or similar, but as a rule the more money you put down the higher the risk you are assuming with more skin in the game. From a seller’s point of view this shows that the deal may be more solid.
Home inspection limits
You can do this different ways like rather than a 10 day period for inspection, shorten this to having it done in 3-5 days. Also, once you have completed your inspection you may want to be more accepting of any of the items that are found and deal with them on your end unless they are substantial enough that they cease your interest in buying the home.
Pay your own closing costs
Buying a home involves a lot of money up front for your down payment and for your closing costs. For first time buyers or those who are short of funds on hand it can be common to ask that the seller cover a certain amount of the closing costs. It would be wise to avoid requesting this if entering a competitive bid situation if you can as a seller will most likely go with the deal where they don’t have to complicate anything and front funds.
This can be one of the best options for a winning dollar offer. You can write an offer stating that you will pay $X dollars more than any other offer up to a certain capped purchase price that you are comfortable with. This can give you a leg up if any of the competing offers are within your desired range.
Be open to the seller’s timing
First, if you can be amenable then tell the seller that you can close in the fastest possible timeframe or that you can work with them on their preferred closing timing. Some sellers may need more time before moving to their next home like if they need to wait until it is built or ready to move in. Finally, if they need to close but remain in the home for a brief period then you could provide short term leased occupancy to them. In these cases you can charge them rent or a fee for them to stay in the home as short term tenants.