Making the Offer: 5 game changing strategies you need to know
The housing market in New York City is extremely competitive. You may be wondering how to get your house offer accepted when a seller will receive 3 or 4 bids on their apartment. How do you make yours stand out? This article discusses 5 strategies for making the offer as competitive as possible.
competitive offers get as close to all cash as possible
Sellers love decisive buyers
Having a professional buyer’s agents increase your chances of success
Helpful Definitions
Contingencies : A provision within a sales contract outlining a condition or obligation that needs fulfillment for the agreement to be legally enforceable.
Pay Cash
Sellers usually prefer all cash offers, so making the offer in all cash puts you at a huge advantage when it comes to edging out the competition. All cash offers usually mean a faster sale as getting a mortgage can be a time consuming activity. All cash offers also mean a guaranteed sale since the deal isn’t predicated on a buyer’s ability to secure financing from a bank. You can see why a seller would prefer an all cash offer to one contingent on financing.
Worried about tying up too much of your cash? No problem. You can always get a mortgage after the sale closes.
Waive Financing Contingencies
When buyers make an offer on a house, they can waive financing contingencies. Not everyone has enough cash lying around to buy property without financing. However, over ⅔ of homes bought in NYC are purchased in cash. Bidding on a house in NYC almost always means competing with an all cash offer, so making the offer with a waived financing contingency can really help you out.
If you’re not comfortable fully waiving the financing contingency, you can choose to waive only the appraisal contingency. In this case, you’re still protected if you can’t get a mortgage; however, if the bank appraisal comes in lower than the accepted price, you might be on the hook to pay the difference. The more you’re putting down, the less the appraisal matters.
Worried about not being able to secure financing? No problem. You can always go through the full underwriting process before signing a sales contract and have your bank check out whether the building is eligible for a loan. Learn more about this strategy in our article about waiving the financing contingency with confidence.
Waive Inspection Contingencies
Buyers can waive inspection contingencies when they make an offer on a house. This means you’re not allowed to back out of the sale if you find something terribly wrong with the apartment. You are buying it as is.
Buyer’s can always conduct their own inspections before entering a sale’s contract to minimize their risk. Note that in a hot market, you may lose out on the sale while you wait for the inspection to be completed.
In NYC waiving the inspection contingency is common practice, as most of the expensive problems that would be caught in a typical home inspection, like a boiler or plumbing issue, are the responsibility of the building rather than the individual homeowner to fix.
Act Quickly and Decisively
Sellers love straightforward buyers. If you see a property that you like, submit an offer quickly and let the seller know that you are committed to turning contracts around and submitting required documentation quickly as well. This helps you too; If a property is new to the market, making the offer before other buyers prevents you from winding up in a bidding war, which will raise the price dramatically.
Have a Professional Real Estate Agent
Sellers and their listing agents like working with buyers with agents of their own. Closing a transaction in Manhattan is a lot of work, particularly when a coop board package is involved.
Seller’s agents like knowing that you have a dedicated representative who is helping them shoulder the load. It also gives them confidence that you’ve already been briefed on the ins and outs of the Manhattan market and that you are financially qualified to purchase.
It is important the seller’s agent feels that they can work with your agent. Working well with the seller’s agent is crucial for a transaction to close; the seller’s agents have the ear of the seller after all. Find an agent with good communication and interpersonal skills.
Don’t Lose Your Dream Home DUE TO A LACKLUSTER OFFER
Now that you know how to put together a competitive offer, it’s time to find an offer worthy property. The first step in finding properties is booking a consultation with a reputable realtor. Get started on your journey today by booking a consultation.
