Buying a home in today’s low inventory housing market is like running a marathon with no finish line in sight. You have to break out of the pack and sprint for home stretch to get your best offer to the seller first.
This means viewing the property, and submitting your offer within hours, not days.
It’s all about supply and demand. There is a major shortage of housing inventory and a lot of hungry qualified buyers. Homes new to the market today often experience long lines of buyers, submitting multiple offers with only the highest and best winning the bid.
This fast pace existed only in certain markets, or with drop dead gorgeous homes before the pandemic. But now that the pandemic has passed, the race continues even with mortgage interest rates significantly higher.
Today’s market has basically reduced the pool of qualified buyers as home prices to continue rise with home sellers less likely to sell. Conditions are not anticipated to change until 2025, according to market analysts.
To maximize your chances of securing the home of your dreams, consider the following:
- Make your first offer your highest and best since you may not have another opportunity.
- Keep an updated preapproval letter or proof of funds on hand, preferably dated within the last 30 days, so sellers can immediately see you are a qualified buyer.
- Be prepared to sweeten the deal with a fast closing or larger than usual earnest money deposit.
Although not recommended, buyers have been known to go out on a limb as noted below:
- Make their earnest deposits nonrefundable.
- Wave their rights to home inspections and make their purchases in “as is” condition.
- Minimize property tax prorations, where they pay the seller’s upcoming tax bills, saving them thousands of dollars.
- Pay the difference between the appraised value and contract price with additional cash when the offer price is more then what the home is worth