10 Creative Ways to Get Your Offer Accepted
Sometimes, you have to get a little creative to stand out in this busy market.
Over the past year, the real estate market has been so hot that it’s not unusual for homes to go off-market in days. (The lack of inventory is to blame.) When even homes that need serious work are breaking price records, it is easy to feel discouraged if you’re trying to buy right now.
Don’t give up, though. Getting your offer accepted isn’t necessarily about coming in with the biggest bag of money. It’s really being able to anticipate what, exactly, the seller’s goals are and creating the offer that solves all of their problems. While your agent will weigh in with a strategy based on your market, there are a few common ways you can make your offer stand out. Whether you’re dealing with competition from investors or want to be sure you are making the best impression as a potential buyer, here are a few things that’ll increase your chances of a successful offer.
Hire an agent with connections
A large part of getting an offer accepted is the communication between your real estate agent and the seller's real estate agent. If your agent has connections or can communicate effectively, the deal is more likely to move forward. Your agent should be asking the seller's real estate agent what their client needs to get out of this deal. Is it the most money possible? Is it a specific timeframe, or do they need to rent the property back while searching for a new home? Knowing those needs and submitting an offer that meets them is vital.
Get in early
Staying in touch with your real estate agent pays off big. They’ll let you know as soon as homes enter the market, especially if they have many connections to other agents. Sometimes, agents will hear directly from other agents about a home that’s about to get listed — or that won’t enter the MLS at all (this is typically called a “pocket listing”). Regardless of how your real estate agent finds the home that fits your needs, be the first to book a showing and get ready to make an offer on the spot.
Be prepared to go over asking
In a seller’s market, it’s rare to find a bargain. While there are scenarios where you may end up successfully offering under-asking price (local market trends will inform our strategy), expect to offer a little more for the home you really love.
Offer a sizable deposit
Deposits are made to the seller and held by the listing brokerage or lawyer. It’s made after the seller accepts your offer and shows that you’re serious about buying. It’s not “extra” money because it’ll eventually be applied towards your downpayment. The typical amount is 5% of the purchase price and due within ONE day of the seller accepting your offer, so make sure this money will be ready if you’re offering it. If you are in a multiple offer situation and your offer price is close to that of a competing buyer, the size of your deposit may make the difference as a larger deposit will indicate the financial strength of the buyer and the seriousness of their offer.
Write a letter to the sellers
When you make your offer, enclose a handwritten letter to the owners thanking them for their time in considering your bid. But don’t stop at a simple thank-you. This letter is about building a personal connection that normally isn’t made when sellers just look at a bunch of numbers. Expand on why you love the home and what caught your eye. If there’s a feature that sparked your interest, it’s an opportunity to build a personal connection. For example, a lovingly-tended garden or a kitchen with all the bells and whistles that a home cook would love. Above all, be honest and genuine. If bidding in a multiple offer situation, and the dollar amounts are similar to the other offers being presented, it is often the connection you make with the seller that will win you the home.
If you’re open to the seller choosing the closing date, you may just get an edge over other offers, especially if the home just went on the market. Think of it this way: Sellers are also usually trying to find another home while selling theirs and may need more time. If the seller is in this boat, the idea of having extra time may be worth more than the extra money another buyer is offering.
You may need to remove conditions
The three most common conditions in a buyer’s offer are financing, inspection, and in the case of a condo, status certificate review. Making an offer contingent on getting a loan, an inspection with minimal issues, or status certificate review by a lawyer, presents multiple opportunities for the transaction to fall through. If you’ve been preapproved for a loan, the seller has had the property inspected by a reputable company, and you’re confident that the property wouldn’t appraise at a lower value, discuss with your agent whether or not you need these conditions. Please note, I am not suggesting that you simply make offers without checking into these issues before offer submission. In hot markets that require condition-free offers, you can still protect yourself by having a serious conversation with your lender about how safe it would be to offer on a home without the financing condition included. To ensure the home is structurally sound, schedule an inspection prior to the offer presentation date so you fully understand the condition of the home going into the offer presentation. Finally, ask the listing agent if they have made the status certificate available for early review. If so, get a copy and send it to the buyer's lawyer for review ahead of time. An offer without conditions will win 9 times out of 10.
Beat out investor interest with a strategic offer
If you’re in an area that’s caught the attention of investors and flippers, don’t lose hope. Winning out over these types of offers is a matter of thinking of the downsides of accepting investor offers. For one, investors tend to offer all-cash but make lower offers because they’re offering cash. Second, they often want the property ASAP, forcing the seller to consider a quicker timeframe than they’d like. You can potentially beat investor offers by making an offer at the asking price (or slightly higher) and emphasizing flexibility on time frame.
Go with your best and final offer from the beginning!
In multiple offer situations, you sometimes are not afforded the chance of a second try. If one offer is far superior to the others, sellers will often take that best offer. It is not a wise strategy to hold back the money you were intending to spend on the home in hopes of getting a 'DEAL'. There are no deals in this market and there are certainly no deals when competing against other buyers. Your best chance at getting the home would be to decide what is the top dollar you would be comfortable paying for that particular home and then offering that amount. I can't count the number of times clients have lost a home for $5000 when they were willing to pay another $10,000 for the home.
Make sure you have your ducks in a row
Ensuring that you have your paperwork sorted, deposit put away, your downpayment funds ready to go, and your real estate agent ready to write an offer as soon as you find "the one" will make the entire process go as smoothly as possible.
The first types of offers that sellers will likely reject are ones from only pre-qualified buyers for a mortgage. Pre-qualification means that a mortgage company has really just taken a glance at your financials to give you a rough estimate on what the amount and interest rate would be. (Often, pre-qualification doesn’t even involve a credit check.) In a seller’s eyes, this means that a lot of things could sink the transaction.
Instead, get a pre-approval. This is a more rigorous process that will look at your credit report, verify pay stubs, bank statements, and other financial documents. If you pass their underwriting requirements, the lender will give you the actual numbers for the loan you’ll be able to get once you find a home (and then provide you with a letter to provide as proof).
If you’re very serious about getting your dream home, you may be able to get a pre-underwriting letter. This is a more thorough process that includes a thorough examination of financials and other documentation needed for a mortgage.
Don’t ask for anything
Even if there’s a gorgeous chandelier you’ve spent years searching for, keep it out of your offer. The key to getting your offer accepted in a heated market is to present the easiest, stress-free scenario for a seller. Present them with an offer that includes only the items they have included for sale as advertised on the MLS. While they may be open to including particular items in the sale, making requests may give the impression that there will be a lot of back-and-forth with the transaction. Wait until you win the bid and get the home before you start asking for items not included by the seller.