Monday, April 30, 2018 / by Bernie Christian
Here is the subject of today's blog...tired and worn out buyers! Why are they tired and worn out you might ask? This morning I sat down with my team of buyer agents in our conference room and the discussion was about buyers that are qualified and eager to buy, but they have yet to bid successfully on the home(s) that they wanted. After several unsuccessful attempts, some of them get discouraged and stop looking altogether. The problem is real. We represent a lot of sellers and in various price ranges and we discovered within a short period of time that buyer competition is stiff below $250K in Fort Worth. Now, this is an absolutely fabulous situation to be in if your a seller, unless you're a seller that is also going to be a buyer. Seller's are have been, and are now experiencing phenomenal appreciation in value. A couple of years ago, when this started to become an issue, our team realized we would have to dedicate a particular email address for other buyer agents (not on our team) to send their buyer's offers to our attention, otherwise they were getting hidden along with all of the other real estate related emails, which would unfortunately at the time, slow our response back to them. Understandably, this was upsetting to more than a few agents who's buyers wanted to know if they were going to receive a response to their offer. At that time and continuing into the present, we had to adapt to a rapidly shifting market, i.e., low housing inventory, high buyer demand due to job opportunities in the area and people moving into the Texas from other states. Adding to this was that builders were building in the $300,000 plus range and neglecting the opportunities in the lower and more competitive price bands. The building of new homes was not and is not keeping up with the burgeoning buyer demand and the existing home market lacked choice and selection needed to have a balanced market. A balanced market is one that favors neither the buyer or the seller.
Well, if you're a buyer just starting out and if you find yourself in this situation, here are some ideas to increase your chances of success in submitting a winning offer:
- Choose your agent wisely - You need a seasoned fighter looking out for your interest. A new or inexperienced agent is not the way to start the home buying process.
- Make sure you bid your offer sufficiently high above the list price of the home. How large? This is where an experienced agent's expertise and experience come in. They should be practiced enough to know what its going to take to be the winning bidder. Not every area is the same so it will vary.
- An all cash offer is KING! It can close faster and with far fewer hassles than with a lender involved!
- But most people have to burrow to buy. If this is you, avoid using the big name brand banking institutions as well as the online banks that do all of the heavy advertising. Guess who pays for all of the advertising...YOU DO! If a buyer agent sends me an offer and the lender is one of these, I will counsel my seller to select a buyer that has local lender with a good reputation. Any seasoned real estate agent knows who these people are and can point you to several. Please note that most real estate agents know that you don't get the service you need from the big banks and they can actually sabotage their buyer's ability to buy because of the difficulty they have originating loans when compared with what a local lender can do.
- The larger the loan down payment or cash contribution you are putting towards the purchase the better. This makes you look more financially stable and sends a signal to the seller that you're lender is less likely to turn you down for a loan. You may be competing with one or more cash offers and need all the help you can get.
- Limit or completely omit any requests for the seller to pay for closing costs, surveys or home warranties.
- Shorten the option period as much as possible or even better, don't request one at all. You can still have the house inspected if you omit the option period but you won't have the option to terminate over repairs. I normally would not give this advice but it is something to consider if you want your clean no hassle contract to be considered by the seller.
- Agree to a large payment of deposit of earnest money in the contract. In our area, 1% of the sales price in earnest money is traditional but you may need to increase that amount by several factors to stand out among the crowd.
- Consider writing a personal letter to the seller about why they should select your offer and submit it through your agent. Write down the things that appeal to you about the home and how you will take care of it. Also mention any special circumstances or difficulties you are having that might illicit a sympathetic response from the seller.
Call us today 817-269-1660 and get the power of The Christian Group, Keller Williams Realty, to help you reduce your stress and fatigue before it starts. We have the market experience and know how to help you get what you want.