There’s nothing more stressful than trying to outbid other buyers on your dream home. That’s just what happens during a hot market. Buyers seem to come out of the woodwork and bid the price of the home so high that you can’t come close to competing.
Does this mean that you won’t be able to buy the home you want in a hot market? Luckily, there are a few tricks you can use to get yourself that winning bid once and for all.
Get Professional Help
We recommend that you use the services of a reputable real estate agent if you are trying to buy a home in a hot market. Real estate agents are privy to the latest listings before you will get to see them on your own. What if you miss the perfect listing and it gets sold right away?
Not only will the right agent give you the head’s up when there’s a listing that meets your needs, but he will also help you win the bid. It’s all about the offer and believe it or not, it’s not always about the money. Sellers are selling a part of their life to you – they want to make sure it’s going to someone that ‘deserves’ it rather than someone that is just being greedy. A real estate agent will know just how to provide the offer so that you get the winning bid.
Don’t be Picky
It can be easy to ask for every contingency available when you sign a purchase contract, but that could be a way to send the seller running to another bidder. You’ll have to pick your battles on this one. For example, if there are some things you don’t like about the home and would like them fixed but know you can do them yourself, keep quiet. Don’t ask the seller to fix everything in the house as a part of the contract. Chances are he will just move onto the next bidder.
You should also limit your other contingencies, such as the appraisal, inspection, sale of home, and financing contingency. If you come at a seller with a long list of these contingencies, chances are they will move onto someone that doesn’t have a home to sell or already has their financing in order. Pick one or two contingencies and leave it at that for the best chances on winning the bid.
Get a Pre-Approval
Some sellers won’t even entertain the thought of showing a buyer the home if he doesn’t have a pre-approval. That letter from a lender that states you can secure financing is worth its weight in gold to the seller. It lets the seller know that you are serious about buying a home and that you have the financial capability to do so.
If you have the pre-approval ready to go, you have a chance of closing on the loan faster, which could be something the seller likes. If it’s a motivated seller, they will be looking for someone that has their ducks in a row and are ready to close on the loan as soon as the appraisal and inspection are complete.
Close Quickly and Be Flexible
Again, sellers in a hot market know that they can have their choice of buyers. If they want to close quickly and you are unable to do so, they may move onto another buyer. This is why it’s important to have everything in order so that you can appease the seller and close when they want.
In some cases, though, the seller isn’t in as much of a hurry. They may be building a home elsewhere or are moving out of state with their job and need to stay in their home for a little bit. If you are flexible with your closing date and are able to let them stay in the home a little longer, it could work to your benefit as far as winning the bid.
Again, because sellers are selling something important to them, they may opt for the buyer that they feel an emotional tie with rather than a random stranger. If you are able to, write the seller a personal letter. Let him/her know what drew you to the house and why you want to buy it. You never know when your personal letter will strike a chord with the seller, allowing him/her to choose you even if you don’t have the highest bid.
Buying a home in a hot market isn’t an easy feat, but it can be done. You have to be quick, resourceful, and flexible in order to make it happen. The best thing you can do is hire a good real estate agent that will have your back through the process and help you buy the home of your dreams.