Highest offers with the fewest amount of contingencies: this describes the current sellers’ market in a nutshell. Sellers definitely have the upper hand right now, which is a good thing if you’re selling – not such a good thing if you’re buying. With so few people listing their homes for sale, the demand has slowed drastically, which means the inventory just isn’t there for buyers to choose from.
This means there are far fewer houses for sale than there are buyers. Translation: homes are selling ridiculously fast, with buyers falling over themselves to score the property they want. In many cases, homes are selling for tens of thousands of dollars over the asking price, with many buyers waiving inspections and appraisals just to appear more attractive than the next.
This is great news for you as a seller; you’ll likely see multiple high offers after listing your property. So how can you best handle multiple-offer situations? Keep in mind, in this market, attractive sellers are often commanding top-dollar – well above asking – and seeing up to 20, 50, 75 offers and beyond for their home. How can you stand out?
Give a Large Earnest Money Deposit
You may want to submit an earnest money deposit, which is an initial deposit you give at the time of the purchase agreement signing. This is actually part of your down payment, but this will show the seller that you’re serious about the sale, especially if you increase it more than you normally would. In essence, you’re offering the seller cash now instead of later.
Show a Pre-Approval Letter
Putting in an offer on a home without having a pre-approval letter is unheard of these days. In order to be taken seriously, you must show the seller you are pre-approved for a specific amount by a reputable lender. This makes you look stronger in the seller’s eyes, much more so than just a pre-qualification letter or nothing at all.
A couple of years ago, you may never have considered waiving contingencies such as appraisals, inspections, and mortgage approval contingencies. But it’s a reality now, and in fact is often the factor that can make or break your offer. You could also offer to close on the property earlier if that would help the sellers, tightening up that timeframe.
Offer to Pay the Difference Between Appraisal and Sales Price
If you are waiving the appraisal, it’s expected that you would offer to pay the difference in cash if the house does not appraise. This could be a few thousand dollars, or tens of thousands of dollars, so be prepared.
Provide Your Highest and Best Offer
In this market, you absolutely can’t low ball the seller. They won’t negotiate with you, because they don’t have to. There may be 25 other strong offers at higher price points than yours, with more attractive terms. Submit your highest and best offer by the deadline – your truly highest and best. Then, if you get rejected, you won’t kick yourself for withholding anything. This often means submitting an offer well above the asking price.
Contact Berkshire Hathaway Premier Properties
As you can see, the sellers’ market is hot right now, which means there’s no better time to consider selling. Contact Berkshire Hathaway Premier Properties today at 832-626-4889 and we can get you going!