Summer is here and the heat is on, especially in the world of real estate. Homes have been selling quickly and for close to the list price. In fact, InfoSparks Market data shows that in July 2016, the average days on the market for homes in Newport Beach was 78 days. In Newport Coast that figure was 83 days, Corona del Mar was 122 days, and Laguna Beach was 109 days on average. In July, homes in these areas sold for an average of 90 percent or more of their original asking price. Being a buyer in a market like this, one that is fast and with little room for negotiation, can be frustrating for buyers. Here’s a look at four tips that realtors have seen prove helpful and some pointers from Nerdwallet.com.
One of the most important things to do when looking to buy a home is to make sure to have your financing lined up. This should not be something that is handled in the 11th hour. Decide who you want to handle your loan and find out the fees, rates, etc. up front. If you are planning to shop around or check out other loan programs, do that ahead of time. Some lenders will even go a step further than providing a pre-approval letter and will produce a direct underwriter (DU) approval. This may give the seller more confidence in the buyer’s ability to close quickly and with little hassle. At the end of the day, working with a lender who can close loans successfully will give you an edge. Even if you are a cash buyer, you need to make sure to have your proof of funds accessible and the ability to transfer the money in place.
Another tactic that buyers can use to cast themselves in a better light to a seller is to remove contingencies up front or in a shorter time frame. There are many times that I speak with agents that are representing buyers for my listings and they will pitch their client as non-contingent. What they mean is that their buyer does not have a home to sell. However, they may still have other contingencies, like reviewing the property condition, disclosures, title, appraisal, etc. Some buyers may be willing to remove an appraisal contingency if they’re in a strong financial position. I’ve had buyers who have offered to shorten their home inspection contingency time frame to show they are serious and motivated to act quickly as well. These are just some examples of what you can offer to stand out.
By offering a shorter escrow, buyers can also gain favor in the eyes of sellers. When a buyer is getting a loan, it is essential to make sure the lender is capable of performing in a shorter time frame. Why do shorter escrows look good to sellers? The most obvious reason is that it allows them to get their money quickly. As a side note, if the seller needs more time to move, flexible buyers might consider giving the seller time to move or letting them rent back the home for a short period.
Finally, writing a letter or sending photos can play a positive role in helping you score your dream home in a hot market. I’ve had several buyers write heartfelt letters when they knew they were likely to be one of multiple offers. It’s a nice way to set yourself apart and help the seller relate to you.
By Holly Schwartz
Holly Schwartz is a realtor with Villa Real Estate who lives in Eastside Costa Mesa and has been featured on HGTV’s “House Hunters.”
