Buying a Home This Year? Discover the Secrets of Home Negotiations That Leads to Fruition

Buying a home this year

When a home goes on the market in a popular neighborhood, it can quickly garner many offers. How can you get the home you want to buy at a price you can afford if there are several offers, and some buyers are even offering more than the listed purchase price?

It turns out that purchase price isn’t the only criteria that home sellers consider when they have multiple offers to buy their home. They can consider other factors, including loan or appraisal contingencies, and will appreciate buyers who are flexible on needed repairs. 

What factors will sellers consider when choosing between offers on their home?

Earnest money deposits: to prevent a buyer from making multiple offers to buy multiple homes, a deposit of money with a real estate brokerage or escrow company can secure your offer and show sellers that you sincerely want to buy their home. Your real estate agent will advise you as to the right amount of earnest money deposit, which can vary depending on the seller and on the current real estate market in the neighborhood where you want to buy. Just a side note: make sure your purchase agreement discusses how your earnest money deposit will be refunded if there are problems like a failed home inspection.

  • Write your best offer: work with your real estate agent to determine the best offer that you can reasonably afford. Especially in tight real estate markets, this can help you to be the winning offer when the seller makes their decision.

  • Get loan pre-approval: We’ve previously written about the importance of being pre-approved for a loan. Having loan pre-approval greatly increases your chances of your offer being taken seriously and accepted.

  • Prepare a counter offer: work with your real estate agent to prepare a counter offer in case the seller requests one. Your agent has the experience to advise you in the counter offer process.

  • Don’t get into a massive bidding war: We get it — you fell in love with a house and you really want it. But you could fall prey to overbidding. Basically no homes are worth paying more than you can afford. Give yourself some backup home choices, and leave the bidding wars to the ultra-competitive people who will get caught up in the desire to beat the other guy at any price.

All of this can sound overwhelming. Working with a real estate professional who can establish a good working relationship with sellers and seller agents will be key to helping you buy the home you want at a price you can afford.

Sources

https://www.thebalance.com/multiple-offers-competing-home-offers-1798836

 

https://la.curbed.com/2020/1/9/21056801/buy-house-los-angeles-real-estate-market-2019

Make This Year Your First Time Ever, Where You Learn How to Negotiate: Tips on How To Successfully Win a Home Bidding War

Bidding War

In today’s real estate market, the most desirable homes can often sell for higher than their original asking price. How does this happen? Well, if you’re looking at elite properties, you may already know: more than one buyer who can afford the home competes to get the desirable address, luxurious estate, and premier neighborhood. Buyers engage in a bidding war. But does the highest bidder always win? Not always. There’s more than money involved in competing offers on real estate, especially with premium properties.

Does the highest offer always win the bidding war?

Selling a home is a financial decision, but it’s also a personal one. Owners are understandably attached to their home, and they naturally have feelings of wanting the next family to move in to be as comfortable and happy as they were. This is why some real estate professionals counsel that it’s smart to write a letter of introduction or actually meet the owners if it’s possible and advisable. 

Here are some other “must-haves” if you know you’ll be in a competitive situation when making an offer on a house:

  • Get pre-approved for financing

  • Increase your earnest deposit

  • Be flexible on conditions (repairs, escrow period, etc)

  • Prepare multiple contracts – anticipate potential increases

  • Negotiate flexibly

Most of all, you should be prepared mentally when making an offer on a home. You may be one of several qualified buyers. In any negotiation, you should always be aware of the maximum amount you can reasonably afford. Don’t go beyond your comfort zone or realistic financial expectations just to “win a war” against another buyer. No matter how much you may love the home you’re bidding on, there will always be another opportunity. 

The ability to win a bidding war on a desirable home is one of the most important reasons you will want to work with an experienced home sales, loan, and real estate professional. California Platinum Realty and California Platinum Loans have the experience necessary to guide you through even the most complex real estate negotiations.

Sources

https://www.moneyunder30.com/win-bidding-war