5 Strategies For Making a Competitive Home Offer

When purchasing a home it can be intimidating to compete with other home buyers. Although this is common in a competitive market, it can be frustrating. There are a few things you can do when making an offer on your dream home to be more competitive.

Here are 5 Strategies for Making a Competitive Home Offer

1. Write a Personalized Letter

Although the home buying process can at times feel very complicated, you need to remember that you are ultimately buying your house from another person. Instead of being persuasive with numbers, you can also appeal to the home sellers emotions. To do this you can write the home seller a personalized letter with your offer. This letter should include details about why you fell in love with the seller’s home, details about you and your family and specific details about how the home is conducive to your lifestyle. When the seller can make parallels between their family and yours they will feel a deeper connection with your offer and this will make your offer more competitive than a homebuyer who doesn’t write a letter at all.

2. Eliminate or Reduce Contingencies

Having too many contingencies in your offer can turn a seller off. If you are in a competitive home market situation you at times need to consider what contingencies are most important to you. Although you shouldn’t get rid of certain contingencies, like major repairs brought up in a home inspection or getting a home inspection at all, getting rid of some of the nitty gritty can benefit you. The more simple your offer the better in a competitive market.

3. Be Flexible & Prepared to Move Fast

When moving, either from a buyer or seller’s perspective, it’s not going to be perfect timing for everyone. Because of this, you can make a more competitive home offer by being flexible. In some circumstances a home seller has another home lined up and needs to get out of their current home quickly, in this case you need to be prepared to move fast with your offer. In other circumstances a home seller might need to stay in their home anywhere from 1 – 3 months while they figure out their moving arrangements, so being flexible with that situation can help too. Displaying your flexibility when making an offer can set you apart from other homebuyers.

4. Have Cash Ready

Buying a home all cash is not an option for many homebuyers, especially first time home buyers. However, if you do have the option to purchase a home all cash, this will be the most competitive home offer. If you don’t have the means to go in all cash, the next best thing is to have cash ready. This means that you have the down payment and flexible cash ready to use in your offer. A home offer with a 20% down payment will be less risky than a home offer with a 3.5% down payment, meaning that the home seller will typically pick the offer with the higher down payment in the long run.

5. Get Pre-Approved & Provide a Pre-Approval Letter

A final strategy for making a competitive home offer is to get pre-approved for a mortgage. When you are pre-approved for a mortgage from a lender it reduces the chances of the deal falling through. To relay this detail to the seller of the home you’re putting an offer on, you can provide them a pre-approval letter. This formal letter will let the home seller know that your bank has approved you for a mortgage and it’s only contingent on the home appraisal.

Using these 5 strategies to make a competitive home offer will help you appeal to the seller of your dream home. When purchasing a home, putting in the extra leg work to make your offer more appealing will give you peace of mind in a competitive market. What other elements do you think make an offer competitive? Let us know in the comments!