It's been awhile since Indianapolis has seen a seller's market. How does this affect buyers? Inventory is low and they are fighting over homes. Have you heard the recent horror stories? Buyers who missed out on one or even several great homes due to multiple offers or sales that happened so quickly they didn't even get an opportunity to look at a property. What's a buyer to do? Here are 7 tips buyers can do to help them win their dream home in this hot market.
1. Get your financials in Order
Talk with a local mortgage broker BEFORE looking at homes. We suggest doing this even months before you're ready. Yes, you will have to provide them updated documents when you're ready to go, but you'll have a plan in place. If there is anything incorrect or something that needs work on your credit score, this provides time to get these items resolved. When the time is right to begin looking for your dream home, your financials are in order and you will have a solid pre-approval to tell sellers you're a serious and well qualified buyer.
2. Find an Experienced Full Time Agent to Represent You
Why is this important? We see buyers missing out on great properties because their agent has other obligations and isn't available to show them properties or doesn't even understand what the current market is or how to adapt. You want to work with someone who is immersed in real estate, understands what it takes to win in competitive situations and is available when you need them.
3. Pounce Quickly
Some new listings are receiving offers within hours of going on the market. If you're looking in a hot area, put a plan in place so you can act quickly when a great new listing hits the market.
4. Be Prepared to Offer Full Price -- or More
Not all listing agents price correctly, so don't get hung up on the list price. Rely on your knowledgeable and experienced agent (just one reason why #2 is so important!) to help you determine the true market value and then offer accordingly.
5. Be Smooth
Make your offer so smooth, the seller will have trouble moving on to another one. What do I mean? Price isn't the only term presented in an offer. Have your agent talk with the listing broker to see if there are other terms which are crucial to the seller's situation. For instance, maybe they want their kids to finish out the school year, if so, do you have the flexibility to build that into your offer? Maybe there is a specific closing date the sellers need in order to also close on their new house. Try to make this happen. In other words, be extremely easy to work with. If a buyer submits an offer with many demands, it may not matter if their price is the highest. Seller's don't want to work with a difficult buyer.
6. Don't Ask for the Moon
Asking for the seller to help with buyer closing costs is common in the Indianapolis Market. However, in a seller's market, when you want to do everything you can to make your offer "the best", consider other options. If you have the funds, pay your own closing costs. If not, consider asking a relative for a financial gift letter. If 2 offers have the same price and similar terms, but only one is asking for $2500 in closing cost assistance, who do you think the seller is going to select? This also isn't the time to ask for items the seller has not included in the sale, so avoid the temptation to ask for more appliances, furniture, playsets, etc. Get the house first -- then see if the seller is willing to leave or sell any of these items. Often they don't want to move them and will be happy to offer them for free or a very reasonable sale price.
7. Connect on an Emotional Level
Submitting a personal letter to the seller along with your offer moves the transaction from "all business" to "emotional". Many sellers have strong connections to their homes and the memories created there. Providing insight into why you love the house and how you are the perfect fit to continue the journey may be just the thing that tips the scale in your favor.
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