With lower interest rates and rising rent prices, more people are taking the leap into home ownership. With the current Seller’s Market many are facing fierce competition, limited choices and the pressure to act quickly. The biggest challenge is that there are not enough homes on the market. In some areas homes are being put under contract in a matter of days.
So what should home buyers do when the market favors the Seller. Here are a few tips on increasing their chances of landing the winning bid without paying more than they should.
First Thing – Get a Pre-Approval Letter
You might know that you’ll be approved based on your credit score and debt-to-income ratio, but the seller doesn’t. The pre-approval letter from a lender shows the seller that you have been financially vetted and how much you can afford to pay. Presenting the pre-approval letter to the seller lets them know you mean business, and in a competitive market it will allow you to act quickly when you see a home you are interested in.
Work With an Experienced Agent
In a competitive seller’s market, buyers need all the help they can get. Having an experienced buyers agent on your side will increase your chances of landing the home you want. Working with a buyer’s agent saves tons of time and stress, they know the process and can provide insight into the negotiation process.
Make Your Best Offer
We are all motivated to buy what we want for as little money as possible. Making an offer lower than the list price is a normal strategy, especially if the house is overpriced in comparison to the other comps in the area or if it’s a buyer’s market. However, trying to get a deal in a Seller’s Market might not be the best strategy. When there is a shortage of inventory and a lot of competition a better strategy would be to go in with a strong opening offer.