Finding the right home can be stressful enough, but in a sellers’ market, it gets even tougher to find the right home right away. The market can change quickly, so it’s important to be flexible and change your plan as the market changes. In a sellers’ market, there are fewer homes listed and usually a rise in prices as well. Finding a good deal is a bit harder, but not always impossible. Here are 5 tips on how to purchase a home in a seller’s market:
- Get Pre-qualified
Before you even start house hunting, it’s important to be sure of what you can spend. There is nothing worse than finding a perfect home, only to realize it’s out of your price range. Getting pre-qualified will allow you to be certain about what you’re willing to spend and prevents you from wasting time looking at the wrong homes. When you do find the right home, you will have to act quickly. Your pre-qualification will help save time and prevent you from losing the house you love.
- Research the Competition
Have your real estate agent find out how many other people are interested on the same property. Other people wanting the same home can give you an idea of how aggressive you should be when placing an offer. If there are several other offers, you may not even have the chance to receive a counteroffer or revise your proposal. Knowing ahead of time can help prepare you to make the perfect offer right from the start. You can even lay out an escalation clause to show just how much you’re willing to spend over another competing offer.
- Flexibility is Crucial
Show that you are willing to move at whatever speed the seller needs. A seller that needs 60 days before closing won’t want to work with someone that needs to close in 30 days. Same goes for the reverse. It’s also important to keep in mind that no home is absolutely perfect. Look past the mismatched carpet and wallpaper because those can be changed relatively easily. Take a step back to really look at the big picture. It may be worth it to spend less on the home and make renovations later, or to purchase an older home with more space compared to a newer home priced much higher.
- Get Personal
You could find the perfect listing at any moment, so be prepared to act fast. If you believe you’ve found your ideal home, be quick about your offer. Work with your Real Estate Agent to send a friendly letter along with your offer to the seller explaining why you love the home and want to buy. Some sellers may find a touching letter about how much you adore the home to outweigh another similar offer.
- Make it Easy
Continue accommodating the seller before and after your offer is accepted. If your funds allow it, you can offer the seller a portion of the closing costs up front. Or you can eliminate further negotiation by getting a pre-inspection before your offer is even made. The seller will see how serious you are and it will reduce your own stresses about the condition of the home. Set reasonable closing dates, don’t be too nitpicky with small issues, and prepare yourself for your new home.
No matter what kind of market you’re currently in, you should still feel positively about the home you’re buying. If it doesn’t feel right, keep looking. Start the process early and get prequalified with NFM Lending before you start your search!