Regardless of interest rates, housing inventory and other variables, a quality home that is well-priced will likely attract a lot of attention. The experts at Coldwell Banker Bain put together these tips to help you navigate a competitive market and get your dream home.
Securing a home in a competitive market can feel challenging, if not impossible. Below, we’ve rounded a few tips to give you the best chance possible at getting your dream home in the competitive market. Following our guide and working with our brokers will help you stay ahead of the pack and position yourself as a potential buyer.
- Get pre-approved
Before you even begin house hunting, get a pre-approval letter from a lender. Shopping with a pre-approval in hand shows sellers a lender has verified your income, creditworthiness, and other numbers, and you have the capacity to buy their house. A pre-approval letter will communicate that you’re a serious buyer. If there are several offers on the table, interested parties without financing could be tossed out. Pre-approval qualifies you for financing and gives you a competitive edge. And keep in mind that pre-qualification is not the same as pre-approval.
- List your needs and wants
Now is the time to break out a notepad and start making a list of your needs and wants. Needs are non-negotiable features that your next home must have. Wants are features you’d like your next home to have but would be willing to sacrifice if you find a good home. For example, you may need a large backyard for your children or pets. You may prefer hardwood floors or an updated kitchen, but those may not be deal-breakers. Knowing your non-negotiable items will help determine whether a home meets your minimum requirements. If it does, you’ll be able to act quickly and make an offer in today’s competitive market.
- Find a great Realtor
A great real-estate broker is your secret weapon when buying a home in a competitive market. One starting point is to look for a broker with the Realtor designation, from the National Association of Realtors. Not only do they have a solid understanding of the current market and the neighborhood you’re interested in, but they also have terrific connections and great negotiations skills, which will work to your advantage. Before you hire a broker, be sure to get referrals, check online reviews, contact several recent clients, and find out their experience. When you have a list of at least three contenders, ask important questions. The inside knowledge of an excellent broker can put you on the fast track to success.
- Look for homes under your budget
In a competitive market, you can expect to compete against multiple or dozens of bidders on one home. As such, it may not be a good idea to look for homes at the top of your budget because chances are another person will outbid you. A good strategy is to look for homes that are below your budget so you can have room to offer above the asking price without going outside your target price point or dipping into your savings. You may also consider an escalation clause, which states that you’ll put your bid at a certain price point higher than other competing bids – but make sure you know when to stop.
- Be ready to move fast
Once you’ve found a home that ticks the boxes in your needs list, be ready to put in an offer right away. Your offer should include all relevant information, forms, and disclosures the seller will need to make a decision. An incomplete offer could end up in the trash in a multiple offer situation. Pay attention to details and make sure your offer is complete. Your agent will be happy to help you draft your offer and have your negotiating strategies at the ready. Also, know how high you’re willing to go if there are other offers and be ready to make tough decisions quickly and decisively.
- Consider making a large down payment
Making a sizeable down payment is another way to strengthen your offer. Of course, you should save up enough for a down payment when buying a home, but it’s more important than ever to do so when buying in a competitive market. You want to show the seller that you are serious, can afford the home, and is ready to put your money where your mouth is.
- Keep trying
A competitive market could mean that you “lose” a few homes to other buyers. Home inventory is remarkably low and homes tend to sell remarkably quickly when they come on the market. If your offer isn’t accepted, do not be discouraged. Keep searching and putting in offers until you’re able to find a home that you love.
If you’re ready to buy a home in the Pacific Northwest, Coldwell Banker Bain can help. We put our knowledge, skills, and experience on your side to help you find the perfect place to call home. Contact us today to get started.