The best house for you is almost never perfect. You have to compromise either on its size and features or on its location. When you find a place that feels like home, it’s best to act quickly.
Your realtor can help you make an informed decision about your offer price with a comparative market analysis. A “CMA” compares the list price to recent sale prices of similar homes in the area. The “comps” are adjusted for differences from the home you want to offer on and averaged to estimate its fair market value.
You also need to weigh list price against local market conditions. When inventory is low, you face a seller’s market and have less bargaining power. Homes tend to sell quickly near list price or above and lowball offers are dismissed. When home inventory is high, the market favors buyers and you have more bargaining power. You may be able to buy at a discount.
Though price is key, the terms of your offer can help to win over a seller or to reduce your costs. In a buyer’s market, you can ask for concessions such as seller-financed closing costs, appliances and a closing date that suits you. In a seller’s market, you’ll want to make all the concessions you can, such as offering a larger down payment and earnest money deposit, timing the closing to suit the seller, or inspecting the home before making an offer and then waiving the inspection contingency if you’re satisfied with the results.
Once you’ve decided on price and terms, your realtor will prepare the paperwork for your review and signature and submit it to the seller’s agent.
Posted in: FAQ for Buyers