Make no mistake, the real estate market remains ultracompetitive. Following a mini slump in sales, the market bounce back is fueled by eager homebuyers and low interest rates. At the same time, would-be buyers are facing limited inventory and ever-rising home prices.
So, how do you gain the upper hand to be competitive? Here are five things that can help you win the bidding war on the house of your dreams.
Secure financing first
Shopping for a home is exciting. Once you find something you love, it’ll be much easier to begin the process if you’re already preapproved for a loan.
Unprepared potential buyers face an uphill battle because time will not be on their side as an unapproved borrower. Make sure to get all your ducks in row and get preapproved for a loan before shopping. This means improving your credit score, balancing your debt-to-income ratio and addressing other financial considerations. This will help you secure the financing you need to be competitive.
Don’t get emotionally invested
It’s tough to not be emotionally invested when you’re talking about buying a home for your family. But in today’s market, remaining detached will be a winning trait. Here’s why.
It’s easy to find the home of your dreams, but it’ll be just as hard if you do not win the bidding war. By staying emotionally detached during the early parts of the process, you retain flexibility and thicker skin to move on to the next one. In addition, this mindset increases your productivity and promotes mental wellness.
Adopt seller’s timeline
Flexibility is key. So as much as you can, try to keep up and follow the seller’s timeline. A sure way to do this is to get preapproved for a loan first so you can keep up with the seller’s timing demands.
At the same time, some sellers may also need extra days or weeks to move out. Be sure to be open and accommodating. This will build good will and foster a trusting working relationship, which will be needed at every step of the home-buying process.
Whenever possible, show a willingness to drop contingencies, which can delay the home-buying process.
Some buyers will make an offer contingent upon the sale of their own home. This can be less than ideal from the seller’s perspective.
From appraisals, inspections and other conditions, you can speed up the process, and win over the seller, with your willingness to waive some of the contingencies or preconditions.
This market is fast-moving. And if you’re willing to move with it, you can be the victor.
Be prepared to act fast during the offer phase. This means promptly responding to the seller if a counter offer is put on the table. Keep all your lines of communications open and active because every minute counts.
Furthermore, map out possible scenarios with your family, real estate agent and lender before you submit an offer. You want to make sure everyone is on the same page and no detail is overlooked when it’s time to quickly make a big decision.