A seller’s market is a competitive one. Buyers basically compete with other buyers for houses that they really want. What’s more, 87% of the 1,000 real estate agents surveyed for HomeLight’s 2020 Q3 survey said their inventory is lower than was expected. Fortunately, 72% of those surveyed predict the inventory in their market will rise (33%) or stay the same (39%).
Regardless of when you’re going to enter the real estate market, you’ll want to have the upper hand. Here are a few tips that’ll give you the edge as a buyer entering a hot seller’s market.
1. Know the area you want to move to
Naturally, you aren’t going to want to move into a neighborhood totally blind! Before you start going to open houses and scheduling showings, you are going to want to know the neighborhood pretty well.
Do a little bit of research to find out the average asking price for houses similar to what you’re looking for (your agent will do this, too). Find out what amenities are in the area (public transportation, a recreation building or park for the kids, etc.) and so on.
By knowing these details, you’ll be able to decide if this is truly where you want to be and how it’ll affect your budget.
2. Have your mortgage pre-approved
A great way to appeal to sellers is by being pre-approved for a mortgage. It shows the seller that you have the funds necessary to go through with the sale and are less likely to back out halfway through the transaction.
3. Work with a top-selling real estate agent
We mentioned that you’re going to want to research the neighborhood that you’ll want to move to, right? Well, you do want to do that, but you’ll also want to find a real estate agent who knows the area inside and out, too. They’re going to know what the average house sells for, what features will command a higher price tag, and how far your budget can go.
4. Submit an offer that stands out
It’s human nature to want to get the best deal possible. Why spend more money than you have to, right? Well, being frugal is nice and all, but in a competitive seller’s market, a low ball offer will not be taken seriously, especially when 54% of agents report bidding wars are on the rise in their market.
Even if you don’t want to offer the full asking price, another good strategy is to submit a clean offer. That means there are no contingencies and you want to get to closing as soon as possible. These types of offers are very appealing to sellers who need to get their houses sold quickly.
5. Include a personal touch with the offer
A strategy buyers are using to get their offers accepted (or at least taken into consideration) is to submit a buyer letter. In this letter, you’re going to want to keep it short and sweet. Tell the seller why you’ve fallen in love with their home. Tell them what it would mean to your family.
You can even add some compliments about their design choices or landscaping. The purpose of the letter is to connect with the seller and show them how much buying their house would mean to you.
When you’re considering buying a house in a strong seller’s market, you’re going to have to be positive and patient. It won’t do you any good to stress out and you definitely don’t want to be unprepared! If you’re feeling overwhelmed anytime along the way, talk to your real estate agent for some advice and reassurance. Your agent is going to be a huge help during this exciting (but sometimes stressful) endeavor.