A seller’s market is likely throughout the rest of 2021. But a possible shift in early 2022 to a buyer’s market is a real possibility for several reasons.
Summary: Navigating a seller’s market can be tough for buyers. This article gives 7 tips to buyers so that they can get the home they want in a seller’s market. In addition, this article also encourages readers to reach out to Sammamish Mortgage for more tips or for additional information on related topics.
A “seller’s market” happens when there are more potential buyers than homes for sale. In a seller’s market, people looking for a home may feel frustrated and not easily find the home that they want. When they find a home for sale that they like, the seller of the home may receive multiple competitive offers at the same moment.
The seller is in an excellent position when this happens. Sellers can pick from the purchase offers to choose the one they like the most. Even if two distinct offers are identical in price or amount, they can still differ in other ways, and so the offer more favorable to the seller will be chosen.
For instance, if a seller has two offers for the same amount, but one is all cash and the other has financing, the seller typically will select the all cash offer. That’s because the all cash offer will be completely free from certain risks which may be present in the other offer.
Causes Of A Seller’s Market
Seller’s markets arise because a particular area is very desirable. There can also be limitations that do not allow any further development of residential properties in an area. Well-established neighborhoods in up-scale market areas are typically likely candidates for becoming a seller’s market. Easy credit financing is another contributing factor.
Check the median sales price as a percentage of the listing price for an area. If it is greater than 100%, this is a seller’s market. Some markets in the State of Washington are currently seller’s markets. As examples, the cities of Tacoma and Marysville are presently classified as seller’s markets. These markets have been boosted because of their proximity to the city of Seattle. Being close to Seattle has increased their value, and their relative affordability has caused many would-be buyers to flock in this direction.
Buying A Home In A Seller’s Market
If you must live in a certain area, and there are extremely compelling reasons for buying a home in a seller’s market, then expect to pay more and work harder to get the type of home that you want. Buyers in WA State should be particularly conscious of this advice, because, as we’ve mentioned, WA has plenty of seller’s markets. Even markets such as Bellevue, which has recently cooled down, are still likely to see multiple competing offers for a given home.
Here are 7 tips about how to get the home you want in a seller’s market:
- Work With A Top Real Estate Professional: You want to go into this challenge along with the best professional help that you can find. You want to choose a top real estate agent that specializes in the market area that you desire. They should know the neighborhood intimately and have represented both buyers and sellers in that market. If you’re aiming to buy a home in Seattle, then be sure to choose either a Seattle agent or an agent from a neighboring area. If your looking for referral to a top agent in your area we can provide one.
- Pre-Approved Credit Commitment: Apply for mortgage approval before looking for a home to buy. Request more than the amount needed and pay for a written loan commitment that guarantees the financing is both approved and legally-committed for the time, plus a little more, that you need to find a home to buy.
- Move Fast: Make a purchase offer as quickly as possible when a new home listing comes up that meets your criteria. If you aim to get the home you want, sometimes this boils down to simply being quicker than your competition.
- Cash Earn Money Deposit: Offer the seller earnest money in cash that is a significant amount to accept the purchase price you offer. By cash, we mean physical dollar bills of around $5,000 or more. Cash makes people sign a deal.
- Offer More Money: If you want a specific home, make your purchase offer 1% or more than the asking price. Also, offer in writing to match any other competing offers plus a bit more. You may get into a bidding war and have to pay much more to get the home.
- Off-Market Properties: Seek to buy a property that is not yet for sale. Ask your agent to call people who they sold a home to before. Ask everyone in the local area if they know of one that is like the one you want. Knock on doors of homes that are one you might like to buy and ask the owner if they will sell the home. This may seem intrusive, but sometimes that is what is involving with getting the home you want.
- Personalize Your Approach: Another technique you can use to enhance your search is to personalize your approach. You can do this by attaching a personal letter to your purchase offer. Use this letter to introduce yourself and let the seller know who you are. Express your appreciation for the home, tell them your journey, and make it clear that you will treat the property well. A personalized letter can be a big “tie breaker” when two offers make purchase offers that are otherwise nearly identical.
To get the home you want, try to be flexible with the basic criteria of what type of home it is. Work with a great real estate agent. Move fast and use our tips to be competitive with other potential homebuyers.
If you are interested in purchasing a new home or in refinancing your current property, be sure to consult with your trusted home mortgage professional.
Contact Sammamish Mortgage for More Tips
As mentioned, WA State has plenty of seller’s markets to contend with. This is precisely why you may need counsel such as the advice given above in order to get the home you want in the State of Washington. If you need additional counsel, reach out to Sammamish Mortgage today. Contact us to speak to one of our talented mortgage professionals. Our professionals can give you advice on many different real estate related topics aside from seller’s markets, including the buying process, mortgage rates, and others. Click here to View Rates for current rates, or for an instant Rate Quote, or Apply Now to use our automated online application system.