According to Real Estate Agents including Lindsey Harn and Andrea Soderin at Richardson Properties who shared their insights with MarthaStewart.com author Carlonie Biggs.
You won’t have much wiggle room to negotiate.
While negotiating with sellers about renovations, repairs, and closing costs is common in a buyer’s market, realtor Lindsey Harn of Richardson Properties says you should be prepared to purchase a property on the owner’s terms when the ball is in the seller’s court. “The seller may want typical contingencies waived or removed with the offer, meaning a buyer should be totally prepared to get through the inspection process and/or contingency phase in a shorter than standard timeframe,” she explains. “In very hot markets, a buyer may need to be prepared to buy without any contingencies all together. In addition, the seller may ask for things like a rent back period at a below-market rental rate.”
You need to be prepared.
Since you won’t have a lot of room to negotiate in a seller’s market, it’s imperative that buyers have all their financial ducks in a row before touring or making an offer on a property. This means having your proof of funds or mortgage loan pre-approval documents in hand, as well as an attorney lined up, if you live in a state that requires attorneys for closing. “To find the best mortgage lender, reach out to your bank, local credit unions, and online lenders to compare your options,” realtor Andrea Soderin of Richardson Properties, says. “Ask each of them what they are offering for rates, loan terms, down payment requirements, property insurance, closing costs, and fees of all kinds. Make a spreadsheet and compare all of these details to pick the best option for you.”
Know that competition with other buyers will be fierce.
If you plan on making a low offer on a property in a seller’s market, Walker says to reconsider. “Many buyers go into a negotiation wanting a deal, but in a seller’s market, there are very few deals to be had,” she explains. “Sellers know that the demand is high and that they have very little competition, therefore low ballers generally lose.” If you have your heart set on purchasing a property, Soderin suggests offering above asking price if possible. “This will set you apart from the competition,” she explains.
You will likely pay top dollar.
To better navigate the ins and outs of buying a home in a seller’s market, Harn says you’ll need to enlist the help of a knowledgeable real estate agent. “Buying a home in a seller’s market can be stressful,” she explains. “This is not something a buyer should trust a novice agent to assist them with. Find a strong agent who is well connected in the marketplace, who will be sure to get you the very best price and terms possible without necessarily having to pay the most money.”
Read the full exclusive published December 31, 2020 on MarthaStewart.com
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