In Real Estate – When You Snooze, You Lose!
Minneapolis / St Paul, MN: A big shift in the housing market in our area has taken many by surprise. Any qualify house under $200,000 is selling in just days, with multiple offers, and above asking price.
With dwindling inventory, mostly from fewer foreclosures, increased demand with more competition because of terrific interest rates, we are seeing more and more multiple offers. This often happening soon after a property hits the market. It brings to mind the popular axiom “when you snooze you lose.” Wait too long to look at a great, well-priced property, or to make a strong offer, and you’ve lost your opportunity.
The problem some of you must confront is that even once you learn NOT to snooze and to move fast, you still might lose.
Why??
- The offer isn’t strong enough even at list price
- There are many offers (sometimes 10 and more)
- Cash buyers are too plentiful
- Lending rules on homes needing a little work
Is this the case with all properties? Certainly not. But we are seeing more competing offers at many price points, and new listings moving more quickly than in the past few years. This is not intended to scare you, and or make you feel that you cannot compete effectively. Simply understand the market has shifted in some significant ways and you need to be aware so you can react accordingly when you find a home you really like.
PAUSE – if you aren’t ready to jump, then you shouldn’t. Just because things have heated up and there are “bidding wars” does not mean you should get bent out of shape or move quickly on an offer when you are really not ready. It’s a huge decision and an expensive one that shouldn’t be taken lightly. Make the decision that is right for you. And be prepared to live by it.
Tips to help you win the deal:
- Be SURE to discuss any offer with your mortgage lender BEFORE writing the offer
- Paying Cash? Have Proof of Funds ready to supply with your offer.
- Know the comparable properties – this is what you pay a Realtor for.
- Do not delay in making an appointment to see a hot new listing. Go now. Take time off work.
- Do NOT assume a listing you like that has been languishing on the market will continue to sit there while you ponder. Remember…NEW BUYERS are hitting the market all the time and they might like the same house YOU do and be prepared to make a move
- Know your budget (not just what you qualify to borrow) and make SURE you know what you are and are NOT willing to spend
- Be ready to make an offer immediately if you like the house. Taking a night or two to “think about it” might be the kiss of death. REMEMBER THE TITLE OF THIS POST?!
- Don’t get caught up in the auction-like atmosphere that can happen with multiple bids
- Just because the tax value is significantly higher than the asking price DOES NOT mean you are getting a deal on the house.
- Know that the home still has to appraise if you are getting a mortgage loan. Just because you are willing to spend more does not mean the bank will.