How to Make Your Offer Stand Out

HOMES are selling fast and furiously, with multiple buyers competing to secure their dream house.

And sellers are definitely the winners in this hot market, with properties being snapped up quickly and often at high premiums to the listing price.

But while money clearly talks when making an offer, there are some tips to help make your offer stand out from the others and help you secure the house you want.

Clearly the headline factor in your offer is how large it is. Traditionally, buyers and sellers often played a haggling game with a lowball offer which was rejected followed by a round or two of increased offers.

But in today’s market there is no time for that game – someone else will simply have made a better offer from the get-go and you have lost that dream home.

So do your sums and homework and make your first offer your best and only offer. Avoid getting caught up in a potentially very expensive auction which could leave you with the house you wanted but at a price you just cannot afford. If someone outbids you for the house, then it was not the right one for you. Stick to your budget and offer what you can afford for the house you want. A house is worth what someone will pay for it.

Make sure your offer is backed up and ready to go with a pre-approved mortgage. Sellers may like the number you have thrown at them – but cash talks. If you have not got the financing in place and are ready to go you may well find they take a lower offer from someone who is pre-approved and in a position to close the deal quickly and with no uncertainty.

Having a pre-approved mortgage offer in hand shows the sellers you are a serious purchaser, and have the finance in place to match your offer. While there are still several steps and hurdles to overcome in buying your home, having agreed and proven finance in place is one major obstacle obliterated – the sellers know the bank will have been through your financial situation and credit reports with you beforehand and is satisfied you are able to make the payments on your new home.

And making the seller have an easy as possible experience can be extended well beyond having the mortgage ready to go.

One way to do that is take on the risk of any problems that may be found when the property is appraised.

In less hot market times, buyers and sellers usually negotiate over any repairs or works that may be identified by the appraiser when they assess the home’s value. For example, will the seller repair the roof or take a lower price if the buyer takes on the task?

These are called contingencies – and the fewer of them you demand from the seller, the more attractive your offer becomes.

Beware though – it does mean you shoulder a much higher risk of unexpectedly large repair bills before the bank will agree to close the deal. In extreme cases you can waive all contingencies, which means you are guaranteeing to buy the property at the agreed price, come-what-may and regardless of the repairs that may be discovered to be needed.

If you are planning extensive remodeling in any case, this may not be a very big problem to work with but if you wanted a turnkey new home, this strategy comes with a much higher risk.

Finally, some would-be buyers write ‘love letters’ to their sellers to convince them they are the ideal new owners of a beloved family home – but this is now regarded as a bad idea.

Despite the good intentions behind writing such a letter, they can cause a risk of breaching fair housing rules by revealing personal details such as religion, race or family structure. This could then lead to the seller making an illegal decision to sell or not based on intentional or unintentional bias.