With the inventory of homes for sale in the Novi Real Estate Market and Metro Detroit Real Estate Market down almost 20% over the last year, with interest rates for mortgages still at all time record lows and the economic situation better, this has created a much more competitive real estate market in 2011. With the Summer market in full effect and more home buyers in the marketplace this has created an increase of demand on homes for sale and I have been witnessing a little more of a “Sellers Market”. With many of the home buyers I have been working with this year we have been in many situations where there have been multiple offers being submitted on one house for sale. When this happens there are a few key strategies I have emphasized to my buyers on how to get their offer accepted.
First is make sure they have a solid pre-approval. Make sure that you have spoken with at least one mortgage lender and have a pre-approval in hand. Every home seller is going to want to see that you have been pre-approved to purchase a home. As always, the larger of a down payment will always make your pre-approval stand out more than others and this will also show that you are that much more qualified to purchase the home.
The second thing I advise my clients to do is put down a large earnest money deposit. The larger of a deposit will show the sellers how serious you are to purchase the home. A general rule I always suggest is putting down a deposit of 3% of the purchase price i.e. an offer of $200,000 will be a deposit of $6,000.
The third thing I always advise is bring your best offer forward. In multiple offer situations you have to be prepared to bring an offer above the asking price. Having an in-depth market analysis will help prepare you on how to position yourself when writing an offer.
The fourth and final suggestion I offer to my clients is to offer a closing date as early as possible to the sellers. The sooner you can close is the sooner the sellers will have the peace of mind that their home is sold. Check with your lender in advance to see if there is anything you can do be able to close as soon as possible. Again by getting your pre-approval all set up, check to see what you can do in advance to submit as much documentation as possible to get your pre-approval as rock solid as it can be.
By preparing yourself with these strategies in place, you will increase your odds exponentially in getting your offer accepted in a multiple offer situation.