Purchasing a home can be a very satisfying experience. Years of hard work and dedication are rewarded in what is a huge accomplishment for most. However, purchasing a home also can pose some challenges. One of the biggest challenges can be finding the ideal home that fits your budget. Fortunately, you can determine a home's monthly mortgage by using a mortgage payment calculator. Another challenge for hopeful homeowners is buying during a “seller’s market.”
What is a Seller’s Market?
A seller’s market occurs when there is a shortage of homes available for sale, resulting in higher than normal listing prices. Even though the conditions aren’t perfect, you can still find and purchase your dream home. You can compare mortgage rates and follow these six tips for buying in a seller’s market to achieve your homebuying goals.
Buying in a Seller’s Market Tip #1: Broaden Your Search
If you are interested in the top neighborhood or school district in an amazing city, chances are so are other buyers. Broadening your home search may not be exactly what you had in mind. However, it could increase your chances of finding and purchasing a home for a decent price in a seller’s market.
Buying in a Seller’s Market Tip #2: Tailor Your Offer
Your real estate agent can do some reconnaissance and find out what is important to the sellers, so you can tailor your offer to meet their needs. For example, the sellers may need to relocate sooner rather than later and therefore would accept an offer with a 15-day escrow over a 30-day. Or, the sellers may be closing on their new home and need more time in their current one. In that case, offering the sellers a short rent-back period may calm their nerves and incentivize them to sell to you over other interested buyers. Knowing such information may make all the difference.
Buying in a Seller’s Market Tip #3: Bring Your Final Offer
In a seller’s market, newly listed homes go into contract quickly. With that in mind, present your final offer first. During a seller’s market, low ball offers hold significantly less weight than they might in other market conditions. Presenting your final offer first could be the ticket to securing the home, while other, lower offers get overlooked.
Buying in a Seller’s Market Tip #4: Offer More Earnest Money
Earnest money is also known as a “good faith deposit.” It is money given to the seller from the buyer to secure the home. Offering more earnest money is a simple way to show the buyers you are serious about purchasing the home.
Buying in a Seller’s Market Tip #5: Have Cash
Lenders only loan the amount of money that a house appraises for by a licensed appraiser. So, if you and a seller agree on a purchase price but the home appraises for less, you will not get the required loan amount. However, a buyer can make up the difference in cash, which is an excellent way to secure a home that may otherwise fall through.
Buying in a Seller’s Market Tip #6: Waive Contingencies
Waiving inspection and appraisal contingencies makes your offer more competitive in a seller’s market. Both contingencies benefit the buyer by allowing them to adjust the selling contract based on the inspection and appraisal findings. Waiving these contingencies to effectively purchase a home in a seller’s market is a bold move and should be approached with caution and with help of a licensed professional.
Are you ready to buy the home of your dreams in a seller’s market? With a fast digital home lending process, you can be on your way to homeownership in no time with Wyndham Capital Mortgage.