In just a short amount of time, the Real Estate market has been turned onto its head. In spite of it all, it is still possible to find your dream home – and you may have! You are now ready to place an offer, but with such a big investment during such an uncertain time, there may be a little hesitation.
We want to help navigate you through this stressful process. Here are some pieces of advice we have to offer on making an offer during this time.
How low should I go?
Inventory is tight right now. With that being said, sellers are able to get away with listing their house at a higher price tag.
However, with the supply being lower than usual, so is the demand. Buyers are wearier due to changes in income and stay-at-home orders. So, buyers may have the upper hand if a seller is eager to just get their home sold and off the market.
This is where a good buyer’s agent comes in because they can have that conversation with the listing agent where they can assess the seller’s situation.
A good rule of thumb is start with an offer 3% to 5% below asking price to start the negotiation process.
The closing process
Once an offer has been accepted, the closing process typically takes 30 days. However, in the age of coronavirus, the buyer needs to be prepared for potential delays.
Appraisers, home inspectors, and repair contractors have all adjusted their work due to health and safety regulations. These professionals have mostly opted for remote and no contact work when possible.
Buyers should prepare by setting out a further closing date and researching your options for adding contingencies into the contract.
Lockdown your financing
With the current state of our economy and many individuals temporarily being out of work, sellers may be apprehensive to accept an offer without proof that the buyer can follow through. In order to ease these concerns, you should obtain a mortgage commitment letter.
A mortgage commitment letter is a firm and formal version of a pre-approval letter, so it is taken more seriously. A pre-approval letter does not mean you have secured your financing since it is a conditional letter.
Also, keep in mind some lenders are tightening up on their requirements and conditions during this time.
Finally, the easiest way to make an offer and negotiate as seamlessly as possible, is to be prepared for whatever curveballs may head your way. Trust your agent and keep in contact with them as much as possible, including your lender.
If your financing is secure and you have the patience for potential delays, then it should be as painless as anything can be during this time.
