iowahomeloans

Three Keys to Making a Competitive Offer on Your Dream Home

Posted on: October 19, 2012

Home shopping can be a stressful experience. The first part of buying a home is all about finding the perfect house. You spend weeks or months compiling lists, visiting properties and narrowing down exactly what you want. When you finally find it, the next phase begins: making an offer and closing on the home. But if you don’t make a competitive offer, your offer could be rejected – and you’d lose the dream home you spent weeks or months trying to find! Here’s what you need to know if you want to make a competitive offer and snag your dream home:

 

1. Look at Comparable Home Sales Prices

Don’t base your offer on other properties that are currently on the market. Take a look at comparable properties that have sold in your area in the past three to six months. These values tell you what people have actually paid for homes similar to the one you’re considering. Start by basing your offer on that – a reasonable dollar amount based on comps.

 

2. Check Out the Price History of the Property

The price history of the property can tell you a lot about what the sellers will accept. Has the home been on the market for a week, or six months? Homes that have been on the market a while may mean the seller is willing to negotiate – especially if the seller has dropped the price since putting the home on the market. Homes that are new to the market may mean that the seller will be firm on the price, because he hasn’t had time to really feel out the market or get motivated to sell quickly.

 

3. Lower Prices Equal More Competition

Keep in mind that if a home is priced low, you’re going to have competition in placing an offer. You may want to offer more than the asking price just to get your offer accepted over the competition. If the home is selling for $10,000 under market value, and home sales have been brisk in the area, it’s safe to assume the seller may be receiving multiple offers. Offering something closer to market and above list price may help you clench the deal.

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