There are many factors to consider when making an offer. Here are a few suggestions.
Look at how the property and the asking price stack up in comparison to other recent sales in the area. It is important to utilize the Comparative Market Analysis, CMA, which can be provided by your Realtor to help justify your offer.
Determine what type of market you are in. Is it a buyers’ or sellers’ market, or is it neutral? In a buyers’ market or even a neutral market, you tend to have more leeway on some of the components of your offer, price being one of the biggest. In a sellers’ market, where properties become part of bidding wars and typically end up selling for more than their asking price and your options might be more limited.
Seller’s motivation can be key. You don’t normally have access to the sellers’ motivation, however, if you did know something, you might be able to make an offer that accommodates his or her needs and helps improve your chances of being accepted. Your Realtor can ask the appropriate questions to the listing agent to help gain any information that can be helpful.
Look at how long the property has been on the market. If the property was just listed, they may refuse your below-asking price offer in hopes of getting the full price from another person. If a prior deal has fallen through, however, and your financial situation looks strong, the seller may well find your low offer quite attractive.
Good Faith Deposit, also known as Earnest Money Deposit is an important factor that gets underestimated. This amount shows how serious you are in the purchasing the property. Typically, the higher the amount is the more interested the buyer is in the property. The amount of money the buyer is willing to lose should they not meet all their deadlines and criteria in the contract. There are even options to increase this good faith deposit after inspections to solidify the buyer’s interest in going through with the sale of the property.
As I have said before, please call a local Realtor for all your real estate needs no matter how big or small. We are trained professionals here to make your life easier. It’s best to surround yourself with the right team of professionals that can continuously give you the right advice for all your circumstances.
The original article can be found here.