You and your agent invested hours, days, weeks and even months searching for the right house. Time spent visiting open houses. But now all your efforts pay off. You’ve found the one. It’s the right size, the right neighborhood and within the budget parameters. This is the home of your dreams. It’s time to make an offer.
Let your agent guide you. A great agent knows what the market will bear. They also have the experience and know-how to save you thousands on your home purchase. When you work with an agent, you can submit an excellent offer that the seller wants to accept.
Don’t make the mistake many first-time homebuyers do of low-balling the offer. Of course, you want to pay as little as possible for the house, but too low of an offer, one that doesn’t account for proper market analysis, may frustrate the seller. If comparable homes recently sold for five to six percent less than the asking price, you can reasonably offer seven to nine percent less, leaving both parties with room for negotiation. In a seller’s market, offering less than the asking price exposes you to the risk of being outbid by other buyers. Your agent knows the temperature of the market. They’ve already experienced what sellers accept and what they reject. If this is the house you want, follow the guidance of your agent when making the offer.
Submitting a bid for real estate is a legally binding document. You don’t want to make a costly mistake that jeopardizes your purchase or forces you to buy a home that requires a lot of repairs and renovations to be livable.
Having a pre-approval sets you up for negotiating power. Remember that the seller actually wants to sell, and you actually want to buy. This is where a little give-and-take compromise wins the day. Once you make the offer, the seller counters, you resubmit and they accept, your next action includes a home inspection. Your knowledgeable agent will have written contingencies into your offer for failures in significant systems that the inspection reveals. At this point, HVAC, plumbing, electrical, foundation and roof systems that need repair are negotiable. Do not let anyone talk you out of doing an inspection. It is well worth the cost to protect yourself from major and potentially hidden issues. Your agent can recommend a home inspector, or you can hire one yourself. Make sure they have all licenses and certifications.
The other primary contingency should be the final appraisal. To qualify for your loan, your lender may require an appraisal of the property’s fair market value. While the inspection protects you from future problems, the appraisal protects you from overpaying. If the appraisal comes in lower than your accepted offer, your agent will begin renegotiation at your request.
Now you’re on your way to closing, the most exciting day in the process. Use your professional real estate agent’s abilities to get you to the finish line.
