This year is shaping up to be a huge one for the seller’s Evansville market in real estate, and sticking the landing when you’re one of the purchasers might be difficult. Let’s hit the listings and show the seller of your desired Evansville house that you’re serious about buying a Evansville home in a seller’s market using these 5 strategies.
Before you place a bid, get pre-approved with your preferred mortgage lender to have your Evansville home-buying finances in order.
Your lender will give you a pre-approval letter that you can provide to the seller along with proof of finances once you’ve been pre-approved for a house loan. Putting in the effort to get your ducks in a row demonstrates that you’re serious about making this real estate transaction a success for both you and the seller.
This quickly elevates you above a disorganized buyer who may ruin the entire transaction with an uncritical eye and uncertain prospects.
Make an Impression
You want to come out of the gate clearly demonstrating your sincere intention to purchase the seller’s property with your proof of funds.
A good approach to achieve this is to make an offer that includes an earnest money deposit as well as a substantial down payment. Expect to put down 1 to 3% of your bid price as earnest money. Furthermore, you want your down payment to be at least 20% of the offer price.
Another incentive to aim for a 20% down payment is to avoid paying more in private mortgage insurance, or PMI, on your monthly mortgage payments.
Choose Your Contingencies Wisely
You will have the option to mention any contingencies that the transaction is dependent on when submitting your offer.
A home inspection and appraisal are usually included in these, as they are nearly always required by a large mortgage lender. You will, however, be able to include any repairs, revisions, or item requests as contingencies.
Because you’re bidding in a market where the seller has a strong preference for whoever they sell to, we strongly advise you to either avoid or keep these extra contingencies to a minimum.
A seller who receives an offer that includes costly repair contingencies is likely to reject it.
Add a Personal Touch
If you have a strong desire to purchase a specific home, consider writing a personal letter to the seller.
Include your purpose for buying the Evansville property in the letter, and feel free to highlight some of the features that have you thrilled about the prospect of buying it. This may seems a little antiquated, but it can have a significant impact on a seller searching for something to set one buyer apart from the rest.
Keep a Cool Head
Finally, because a seller’s market concentrates all power in the seller’s hands, you may find yourself in a bidding battle at some point.
In this case, it’s best to step gently and be honest with yourself. Don’t merely keep raising your bid out of a false sense of pride, and be aware of your financial limitations.
Walking away from a bidding war is nothing to be ashamed of, and it could lead to a far better offer down the road.
Another thing to bear in mind is that if a buyer submits a high bid that ends up being far higher than the Evansville home’s appraised value, the buyer’s lender may refuse the loan outright or require the buyer to pay the difference.
Help Navigating a Seller’s Market in Evansville
Buying in a seller’s market can be challenging, so call us immediately for assistance!