The spring housing market is off to the races! And no one wants to pay more than asking price in the hopes of getting your dream house but are you willing to lose it?
In the North Shore market there’s still not enough housing available, so buyers are finding a very competitive market. And due to lower mortgage rates, as low as 4%, many buyers who were choosing to sit on the sidelines are coming back into the marketplace. It’s the classic case of low supply and high demand, which is considered a Seller’s market when there’s more Buyers than Sellers. Due to the increased competition, today’s Buyers face a bigger challenge — they often have to act fast and bid high to woo Sellers into accepting their offer. Most Sellers are selling their homes in less than 10 days, so we are definitely dealing with a Seller’s market this Spring.
Bidding wars are becoming more and more prominent, and so it’s important that you find out if there are other offers before you make an your offer. By using a Buyer’s Agent, you will have someone who will negotiate on your behalf and can find out how many other offers are on the table. They can also guide you as to the fair market value by showing what similar homes are selling for, to give you a benchmark when pricing your offer; and they can also help you by composing a letter to accompany the offer to make it stronger and more personal.
Cash offers made up 29% of single-family home and condo sales in 2017, according to ATTOM Data Solutions. So, if you know you’re competing against a cash offer, making a bid that’s over a home’s list price could persuade the seller to accept your offer. The caveat, of course, is you don’t want to offer so much above asking price to the point where you significantly overpay for the home. And if you are financing it with a mortgage, the house has to appraise at market value for the lender to approve the sale. Any difference between a home’s appraised value and your contract price would have to come out of your pocket. As always, you’ll want to rely on your real estate agent to help you craft a winning offer you can afford.