Wednesday, July 15, 2015
The Details of Making an Offer on a Home
With financing in place, a great home located and preparation for placing an offer beginning, the often lengthy process of purchasing a new home approaches its successful completion. The remaining steps are legally important for protecting your own interests and ensuring that your dream home won’t become a nightmare following your purchase. From contingencies for issues that present themselves following an accepted offer to price negotiation, ensuring a fundamentally sound offer on a piece of property is the best way to complete a successful acquisition of a new home. So, what are the most important details to keep in mind when drafting an offer on the perfect home for your needs? With the help of an experienced real estate agent, you can submit an offer with full confidence, knowing that you’re legally protected throughout the final purchasing procedures, and by remembering to study the following details, your offer will have a great chance of kicking off a successful end to your home hunt.
With the help of your real estate agent, performing a comparative market analysis (CMA) is a great way to find an estimate of the fair market value of the property upon which you’ve got your eye.
According to Front Door, there isn’t a more reliable, widely used mathematical method of estimating a property’s true value than a CMA. By distilling all of the most important characteristics of your potential property, including bedrooms, bathrooms and square footage, into quantifiable statistics, you’ll have a much clearer indication of the true value of the property before submitting an offer. Instead of focusing on asking price, use comparable properties that have recently sold in the area to determine an offer. Luckily for inexperienced buyers, real estate agents have access to all of the databases and records needed to get incredibly accurate home value estimates while protecting tight budgets.
Take a look at the market in the area to have a better idea of market conditions. If you’re in a buyer’s market, big savings could be available when making an offer.
Speaking of comparable properties, studying market conditions before putting in an offer is essential to getting the best value possible. In a seller’s market, you’re likely to find competition on great properties. As a result contingencies and concessions may need to be eliminated in order to make your offer more favorable. Conversely, buyer’s markets are great to see when you’re making a home purchase. In this case, housing inventory outweighs buyer interest, and you’re much more likely to have offers below list price accepted without a bidding war. Ask your real estate agent how to shape your offer to match market conditions, and you may find savings that you didn’t know were possible.
Each seller is different, so there is no ‘one-size fits all’ solution to creating a successful offer. Depend on the experience of your real estate agent to make sure your offer shines, and never attempt to make an offer alone.
According to Fox News, gathering available information on the seller of your potential home could be a great start to making a sweet offer. For example, if a property recently held an estate sale, chances are high that a quick closing may be more important than meeting list price. In any scenario, doing some detective work on a property could help you guide your offer more precisely. Avoid insulting homeowners with low-ball offers and excess criticism on a property to which they may have sentimental attachment. Since sellers have no obligation to take the lowest offer on the table, details are important to improving your chances. Again, the experience of real estate agents is invaluable to getting the property of your dreams.
Keep emotions out of the negotiating process. If the seller has unrealistic expectations of the value of their home, don’t hesitate to walk away from a deal instead of overpaying for a piece of property.
After an exhausting home search, it can be difficult to separate emotions from business when putting in an offer on a property. While some negotiation is almost always necessary with initial offers, remember your budgetary restrictions before purchasing a home. While it can be difficult to commit to reentering the housing market after deciding on a property, overpaying for a home is never a good idea. If the seller of the home refuses to negotiate to fair market value, walk away, and depend on the expertise of your real estate agent to find a more realistic option that won’t be a bad investment for the future.
Peter J. is a writer whose interests include central Texas real estate, studying the stars and couponing.