The market that we are facing in 2021 is best described as a Seller’s Market. What exactly is a Seller’s Market? Simply put, there are not enough properties for sale, and an over abundance of buyers. In a Seller’s Market, the properties move fast, and we often see the terms in favour of the seller. There will often be multiple offers, and seller’s will focus on the price point and the least amount of conditions.
What are some tips for buying in a Seller’s Market?
Hire a professional
Know your budget
Be prepared to act fast
Have a backup plan
Be prepared for rejection
Pre Approval is a tentative promise from a lender that they will loan you a certain amount of money for the purchase of real estate. Speak with a professional Mortgage Broker or Bank, to learn what you are approved for before you start the purchase process.
Hire a professional
Everyone today wants to be able to save money. Which is understandable, however by listing or buying a house without professional real estate assistance, you could end up spending more in the long run. The real estate salespersons in your area know the market, the comparables, the right questions to ask, and they look after all the paperwork for you! They are also well versed in negotiations, and may be able to work out a better deal for you. Support and guidance on the biggest purchase of your life are an added bonus provided by real estate professionals.
In summary, a Seller’s Market can be both scary and exciting. It is a great opportunity if you have been looking at selling, and an intimidating experience if you are looking. Stay informed, and you can make it through this.
In a Seller’s Market, knowledge is key. Ensure that you have all the information you can on the market conditions, comparables, location and neighbourhood. Before you make an offer, ask your professional salesperson to assist you in your research. Do your research on the house as well, to make you sure you are not being stuck with an unfavourable property/home.
Come in with a Strong Offer
A strong offer does not just mean the highest price. Do your research about the seller. Do they need a quick closing date? A longer closing date? What do they want to take with them when they leave? If you can make your offer more appealing to the seller, even with a lower monetary amount, you may still be able to be the winning offer.
Know your budget
In a Seller’s Market, you may be tempted to go over the budget you had in mind at the beginning. Pick a number and stick with it. A good tip is to look at properties that are listed under your top budget. Another tip is to look at your day to day budget, and see where you can cut your spending, in order to make up the savings for a higher budget.
Limit (but not exclude) conditions
Conditions used to be very common, but over the last year, the offers without conditions have held a higher winning streak. If you are able to make an offer without a condition, that would be in your best interest. However, do not exclude conditions if they are necessary, ie: purchase based on financing, or purchase based on a home inspection.
In a Seller’s Market, you will likely only get one chance to view the property. You must take good notes, and take care to see all that you wish to see. If offers are not being held on a certain date, you will want to make an offer as soon as you possibly can, and that requires a speedy thought process. If offers are being held, that will mean that you have a little more time to think if you want the property, but will require more thinking about the price on the offer.
Have a backup plan/be prepared for rejection
It is very likely that a buyer could lose out on all their offers. With so little inventory, and so many buyers, the prices are leaping. If you have already sold your house in the hope of purchasing a new one, be prepared by having a long closing, or arranging a rental place until you find your new home. Keep in mind that if your offer is turned down, it is nothing personal.
If you have any questions, please do not hesitate to contact us today.
Melissa & Christine
The Bachmann Rice Team
Century 21 B.J. Roth Realty Ltd
Independently owned & operated