Housing Market Hustle | What I Have Learned From the Current Real Estate Market & 7 Buying Tips

Housing Market Hustle | What I Have Learned From the Current Real Estate Market & 7 Buying Tips

Housing Market Hustle

What I Have Learned From the Current Real Estate Market & 7 Buying Tips

Real Estate Market

If you have been paying attention to the housing market lately, you can see that it is insanely competitive! My partner and I have been looking for a house with a dedicated workspace like a garage or pole barn for my business. Unfortunately, most of the homes we put offers on are selling way above asking price and are normally cash offers.

It is good for our investment properties and their equity, but bad for us trying to find another home within our desired budget. There are some houses going for $40k... $50K... and sometimes, even $100K over asking price! 

However, here are some of the strategies to make your offer more competitive:

  • Non-Refundable Earnest Money Deposit
    • Earnest Money Deposit: This is money down to demonstrate that you are a serious contestant, which is ordinarily refundable if you back out.
    • Non-Refundable Earnest Money Deposit: If your offer and deposit are accepted, but you back out due to inspections, financing issues, etc., you will not get your deposit returned to you. It shows you are even more serious about this house.
  • Appraisal Gap Guarantee
    • Because many of these houses will not be appraised for the amount offered, buyers with extra cash available will offer to pay the difference between the accepted offer and appraisal.
    • Many though will specify a limit (e.g. up to $10K, $20K, or another amount) in case the appraisal gap is outside of their budget.
  • Waiving Inspections
    • This is too risky in my opinion. We have only waived inspections twice because the houses were very nice and we could not identify any major problems.
    • However, if you are buying an older home, there could be many hidden problems. I just hope this strategy does not financially harm too many people in the future when problems arise.
  • Shortened Inspections
    • Basically, you promise that you will get inspections completed quickly, specifying within a certain timeframe to close faster for the sellers.
  • Home Occupancy Extension
    • This is not extremely popular from what we have seen because it can make life inconvenient for you, but... You could offer extending the sellers occupancy to give them time to find another house.
    • It's not direct money, but it is an appealing benefit especially since finding another home in this market may be challenging for them.
  • Escalation Clause
    • This has been the new, hot tactic!
    • You basically say, "Hey, $250K is our offer, but we can pay $1000 (or any amount) over the next highest bid up to $270K."
    • It has not worked for us yet, but apparently, it is extremely helpful with negotiations and speeds up the decision process.
  • Pay Sellers' Cost
    • You can offer to pay sellers' costs such as title fees and real estate commissions, etc. It is not very common, but it could be another competitive advantage.
  • All Cash Offers
    • This is the golden snitch for sellers and the bane of our existence. Cash offers are quick-to-close and way less of a hassle.
    • Therefore, sellers are more willing to take a lesser offer if it is cash because it is a sure bet.
  • If you know of other tactics or strategies to include in this blog post, please email me at: hello@themktmade.com

Final Thoughts

If you are still in search of a home, be patient. The housing market is already slowing down a little for a few reasons:

  • Interest rates are steadily increasing.
  • We are almost done with the busiest time of the year for real estate, which is early spring to summer.
  • It has become a bit more challenging to be approved for a mortgage.
  • Things are getting back to normal and opening up. So, there probably isn't the itch to change scenery for many of the buyers.

So, if you are infuriated by the process and want to quit, please do not give up on this just yet! BECAUSE, others are quitting right now and it could be advantageous for you to be diligent and resilient.

Happy Hunting!

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