6 Tips for Making a Winning Offer on a New Home and Beating the Competition
The weather isn't the only thing that is hot in the Goodyear area right now! The housing market is on fire! This means if you are looking for a new home, you could face some fierce competition out there. So how do you beat the competition and win the home? Here are 6 tips to help you set yourself up for success:
1. Get pre-qualified or preapproved for your home loan. This is a very crucial step that buyers often put off until the last minute. Bottom line, in the Goodyear area, sellers will most likely NOT consider your offer at all if you do not have at least a prequalification form completed by your lender. A preapproval letter is even better and will help increase the confidence a seller has in you being able to complete the purchase of their home. If you spend some time working with a lender from the start, you may be able to increase your buying power.
2. Stay flexible. In a seller's market like the one we are experiencing today, being flexible with the terms the seller wants can help you win the bid. Some sellers may need to extend the closing date past the normal 30 to 45 days so they can move into their new home. Being mindful of what the seller wants can help you rise above the competition and make the seller want to work with you instead of other buyers.
3. Write a letter. Past clients of mine have had great success with writing a personal letter to the seller about why you want to purchase their home. I recently had a buyer that needed to relocate back to Arizona due to her parents' health issues. She wrote a lovely letter to the sellers and it helped her get her offer accepted. We just closed escrow at the end of June and she is getting settled in her new home.
4. Use an escalation clause. In a market with low housing inventory and high buyer competition, an escalation clause can help you get your offer accepted. You simply agree to increase your bid if another buyer outbids you. Of course, we put a cap on how high you will go to protect you. Using an escalation clause is a great way to beat out the competition.
5. Increase your earnest money deposit. Increasing the amount of your earnest money helps gain trust and confidence with sellers. It is important to know that you could end up losing your earnest money to the seller if you end up cancelling the sale. However, the Arizona Purchase Contract has several contingencies that protect buyers and their earnest money, including the inspection period contingency, the appraisal contingency (the property must appraise for the sales price or higher or you can cancel and get your earnest money back) and the financing contingency (if you can not obtain loan approval, you can cancel and get your earnest money back).
6. Start working with a Realtor right away. One of the best ways to beat out the competition is to align yourself with a Realtor that can help you get ready to beat the competition. In addition, your Realtor can start networking with other agents and past clients to find a property that may be hitting the market soon.
Ready to start looking for a new home in the Goodyear area? I'm here to help! Our first step would be to have a conversation about your goals and what you are looking for in a new home. We can then get a game plan together to help you find the perfect home. My goal is to help you experience success on your road to being a homeowner with less stress!