It’s a great time to buy a home in the Denver market. The equity train is just getting started, thousands of people are moving here every month causing prices to continuously increase. Opportunity to gain equity in your home is abundant, it just takes some aggression to get into a home. After you find a realtor (I’d love to help) the fun begins. Going on showings, walking through homes is fun, you get to use your imagination and learn what you like and don’t like in a home. Once you find that house that you want to be home, the challenge begins! Most likely, there will be multiple competing offers placed on this property, all over asking price. So what do you need to do with your offer to make it stand out? Here are the top 5 ways to make your offer stand out to the sellers.
- Price – this one seems obvious, but it’s not for many people who aren’t familiar with this market. In most cases, you need to offer above asking price – way above! Depending on what price range you are in, you may have to go as much as 10% – 15% over asking price. This is normal for anything under $400,000.
- Appraisal guarantee – Because offers are going over asking price, in many cases, the sellers want to be sure that they will not have to lose a contract because of an appraisal shortfall. A buyer can only get a loan based on the appraised value of a home. If the agreed contract price is above the appraised value, the buyer will need to have cash available to pay the difference at closing. If the buyer does not have sufficient cash available, the buyer and seller will need to re-negotiate, and likely, lower the price. Sellers do not want to incur this problem so they will select an offer that provides an appraisal guarantee.
- Inspection – Inspections are the first major hurdle to get over in a real estate transaction. Many buyers will submit an offer without an inspection requirement to make their offer seem stronger. If the home you are interested in is older or has more visible damage to it, you can submit an offer with an inspection, but say it’s only for major heath and safety items. This will provide the seller with some security knowing that you will not be concerned with minor issues.
- Pre-approved with a local lender – Having a local lender who is available to work on the weekends and evenings is critical to succeed in this market. You need a lender who understands the speed and urgency in the Denver area and will call the listing agent to provide them with insight to your ability to close a loan. For them to do that, you MUST be pre-approved before writing an offer. Getting pre-approved is a step you need to take before writing an offer.
- Full-time agent – There are a lot of real estate agents who only do real estate on the side as a part-time job. You need someone fighting in your corner who does this full time, and who you can count on to be available late nights and weekends…. That’s when real estate happens! If you submit an offer, your agent should call the listing agent before sending in the offer to build report. If you agent only does this part-time and doesn’t have time, you’ll struggle to get an offer accepted.