What to Offer For a Home and How to Know

By
Real Estate Agent with RE/MAX Executive Realty 91362

You have found a perfect home. How do you know what to offer? When you are looking to buy a house, there are many things that you will need to consider.

One of the most important decisions you will make is what to offer on the house. Your buyer's agent will be able to assist with an appropriate offer.

The local real estate market will often dictate the terms and conditions necessary to be in the running with other home buyers.

We'll be taking a look at some helpful tips on knowing what to offer for a house you love.

Determine The Value of The House

Before you start offering money on a house, you first need to determine the property value. You can do this by researching the market or talking to a real estate agent.

One of the more popular questions real estate agents get is how to find out what a house sold for. Sellers ask when they are considering selling their property and buyers ask when their considering making an offer.

Once you have a rough estimate of a home's value, you can think about what price range you would like to stay in. It's essential in today's real estate markets defined by bidding wars. Buyers need to make sure they are not going outside their comfort zone.

Set Your Price Range

After determining the house's value, it is important to set your price range. You may want to stay within a certain price range to avoid overpaying.

It is also important to stay within your budget so that you don't end up losing money on the deal.

Visit Several Houses In Your Price Range

When you have determined the features of the houses in your price range, it is important to visit several of them. This will help you understand how each house looks and feels.

Once you have a general idea of what kind of layout, size, and features are popular in your area, it is time to narrow down your search.

Many factors will affect the price of a home, but some things that may be worth considering include the location, number of bedrooms and bathrooms, condition of the house and yard, and neighborhood amenities.

It's essential you don't overlook anything. There are a few things to always research before buying a home. Not doing proper due diligence can lead to making mistakes you'll regret.

Get a Comparative Market Analysis

After you have set your price range and determined the house's value, it is important to get a comparative market analysis to verify your beliefs. A CMA will help you understand what houses in the same price range are selling for.

Getting a CMA is the best way to ensure you pay the right amount for a house. The CMA will show you what houses in the same price range have sold for, providing you with an accurate estimate of what the house is worth.

A CMA can also help you identify issues with a house that may need to be considered.

Think About The Features Of The House

Once you have determined the house's value, it is important to think about its features of the house. You may want to offer more money for a house with certain features, such as a pool or a backyard.

For example, if you are looking for a house with a pool, you may want to offer more money for a home with this feature. On the other hand, if you are looking for a house in a specific neighborhood, you may not care as much about the house's features.

What Should Be in The Offer?

When you are ready to buy a house, you must understand what should be included besides your offer amount. You should also be familiar with other important elements such as the required earnest money, how much you're financing, and the preferred closing date.

Lean on your real estate agent for help with what is customary. They can help you custom-tailor an offer that has better odds of being successful.

For example, if the earnest money deposit is usually five percent, don't offer less.

It is helpful to find out what the seller wants for a closing date. If you can, give them their desired closing time.

It is not unusual for home buyers to bid over asking or even waive common contingencies such as a home inspection or bank financing in hot seller's real estate markets.

Waiving the appraisal and home inspection have become commonplace. Buyers are looking for every edge to entice the seller into accepting their bid.

Whether or not you want to take these risks will be up to you. It's possible you could find out it will be necessary to land the house you want.

Make Sure You Have a Preapproval Letter

Before making an offer on a home, you will want to be preapproved for a mortgage. It is unlikely any listing agent or home seller will accept an offer without a preapproval letter.

The lender will want to know your credit score and other financial information to provide an appropriate loan. The lender may also ask about your current mortgage, home equity, and other assets. Some lenders also require a specific down payment or reserve percentage before offering a loan.

This information can help you determine what kind of loan you qualify for and what payments you can afford. You may also want to include this information in your offer to the seller.

Final Thoughts

Making an offer on a house is a big deal. Be sure you've done an appropriate amount of homework to ensure you'll be satisfied with your purchase.

A lack of due diligence is often the number one cause of buyer's remorse. With something as significant as a home purchase, it makes sense to take the time you need.

Lean on your real estate agent for expertise and guidance. Best of luck!

Posted by

Bill Gassett is a thirty-two year veteran to the real estate industry. He enjoys providing helpful information to buyers, sellers and fellow real estate agents to make sound decisions. His work has been featured on RIS Media, National Association of Realtors, Inman News, Placester, RESAAS, Credit Sesame and others.

Comments (3)

Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Good afternoon Bill - this is sound advice for buyers who really need to be education so that they are ready to offer when the right house comes up.

May 05, 2022 12:27 PM
Bill Gassett

Thanks Grant Schneider I appreciate your comments. Determining the right offer amount is harder in the crazy market we are experiencing at the moment.

May 05, 2022 01:23 PM
Bill Salvatore - East Valley
Arizona Elite Properties - Chandler, AZ
Realtor - 602-999-0952 / em: golfArizona@cox.net

Thank you for sharing the information. Buyers and sellers in your area will benefit from your expertise. Wishing you continued success.  Have a wonderful day and sell a house.  bill

May 05, 2022 02:52 PM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker/REALTOR® - Kalispell, MT
Helping your Montana dreams take root

These are all good tips for home buyers. What's interesting about the last year or so is that often CMAs and list prices (and eventual sale prices) aren't always linked.

May 06, 2022 05:33 AM