OK, you want to buy a house. Your job and financial position are stable; you have sufficient savings for the down payment and you have been pre-approved for a loan. You’re the perfect candidate for home ownership. There is just one small problem. You can’t find anything that you really like and when you do there are already higher offers on the same house. Interest rates and home prices are already increasing and you’re afraid you are going to miss the boat if you don’t find a home pretty soon.
It can be a frustrating time for county homebuyers who face a limited selection of homes and must compete with multiple offers when an acceptable property is finally located. Beyond getting pre-approved for a mortgage and checking the Internet for the new listings, is there anything else that a buyer should be doing that will help in having their offer accepted and opening escrow? But of course.
Get yourself a really good agent who likes working with buyers as opposed to one whose specialty is working with sellers. There is no cost to a buyer to retain the services of an agent so you may as well get the best who will work hard in finding a home and represent you through the purchasing process. Full-time practitioners, those who work 24/7 as an agent, are usually more focused on their clients’ needs than “part timers” who have other employment. Find an agent you can be open and honest with. If you don’t plan on making a decision on a home until summer, that’s fine, but don’t have your agent spend their immediate time searching for a home today. Don’t deceive an agent into believing that you’re interested in buying a home “only if the right home, at the right price comes along” if ,in fact, you are really motivated to buy something today. And when your circumstances change let your agent know.
Let the search begin. Since most buyers have a better idea of what they like than their agent, agents often input their buyer’s home preferences into the MLS computer. When a listing meeting their buyer’s specifications is entered into the multiple listing services by any member agent, the pictures, detailed information and location is automatically e-mailed directly to their client. Diligence is required when searching for a home. Check e-mail for new listings often. Waiting until the weekend or putting it off until the next day is often too late. Don’t waste time browsing the plethora of real estate Websites. They all get their information from the source — is our local MLS, MetroList. Other Websites often have inaccurate or outdated information.
It’s a race. Upon the discovery of a home you like, you have no time to waste. Other buyers are likely looking at the same information. It’s important to contact your agent immediately and request an appointment to preview the property. Don’t delay thinking you can “drive by” later. If at work and you’re schedule does not allow you to leave, have your agent preview the house for you and call you back with their impression. If it’s a match, have your agent prepare a purchase contract ready for your signature when you can get together.
After previewing, if you like the home, tell your agent. This is what you say. “I really like this house and I want to make an offer now.” This is no time to be coy or attempt to hide your excitement. If you’re not quite sure the home is a perfect fit, that’s OK; you will have ample time to reconsider, if and when your offer is accepted. The objective at this point is to have your offer accepted or an acceptable counter offer from the seller.
If you have been at this point before and your offers are still not getting accepted here are a few additional strategies that are working for some buyers:
Be bold. Increase your offering price 1 to 2 percent higher than the listed price depending upon how much you like the home. At today’s interest rates that may only marginally increase your monthly payment. Besides, with home values increasing at the rate of 1 percent a month, the small additional price premium will have little long-range effect. If the house doesn’t appraise for the higher purchase price, buyers often have the upper hand in negotiating the difference once in escrow.
Be personal. Include with your offer a “pitch” letter. Write a letter to the sellers telling them why you like their house. If the backyard garden is a prominent home feature, describe in your letter how much you like gardening and what you would plant if you lived there. Include photos of you and the family. Often, sellers prefer to sell their home to folks like them. Pitch letters prove particularly effective when they create a personal connection with longtime occupants. Too often we incorrectly think money is the seller’s only motivation but when multiple offers are similar, sellers will often chose the buyers they feel will appreciate their home and any improvements they have made.
Get started. If buying a home is a priority for this year, get started early. There will be less competition from other buyers this winter than in the late spring and summer months when school is out.
Ken Calhoon is a real estate broker in El Dorado County. He can be reached through his Website at kencalhoon.com