When the Minneapolis real estate market was red hot over the past couple of years buyers were looking for anything they could to give them an advantage. Inventory was low and buyer demand was high. The best homes sold in days, if not hours, and often times with multiple offers. In this highly competitive situation some buyers were writing letters directly to the seller in an attempt to connect with them on an emotional level. Did it work? Quite often. We had multiple buyer clients that won their dream home by finding a personal connection with the seller. Now, I'm not going to say the sellers sold to our clients for 10's of thousands below other offers, but in a couple cases their response was clear: We like your buyer the best, but we have an offer for more money. If your buyer will match the offer we'll work with you.
For more tips on the home buyer letter watch the video below or visit my Minneapolis real estate website.
Now, while the home buyer letter worked very well in a highly competitive situation I would not say that every buyer should write a letter and every time. When would you not write a letter?
In a less competitive market where homes linger on the market for a longer period of time and there is downward pricing pressure and the absence of other offers it may work against you to write a personal letter to the seller. In this scenario the buyer may be more price sensitive to ensure they are getting a fair price. Writing a letter stating how this is your dream home you can't live without doesn't exacly give you leverage to get a discount on the list price.
If the home is a foreclosure and you're buying directly from one of the soul-less big banks a home buyer offer letter won't be worth the time.