As you have experienced, our supply is low. In our May 2021 Charlotte Market Report we noticed our monthly supply was 68.4% lower year over year, putting us at .6 months of inventory (average inventory is around 6 months). Being at a 10th of our standard inventory, we have to get creative. Our clients need our professional advice and wisdom when it comes to making their offers stand out. There are a variety of ways that you can do this that are surprisingly easy. Here are some of the best ways that you can help your buyers get into their dream home.
Put Down Healthy Deposits
Of course, increasing the purchase price is one of the easiest ways to get noticed. However, sellers are starting to realize that purchase price is not the be-all-end-all. We are seeing some commonalities that the highest purchase price is being turned down because they are prioritizing the ease of the transaction, not a few thousand extra dollars. Healthy due diligence and earnest money deposits can be daunting, however, this is an excellent way for your clients offer to stand out. Due diligence is important because it indicates how serious your clients, it is non-refundable after all. Earnest money is another great way to shower how serious you are after you have conducted your due diligence. We find the heftier the due diligence, the better. Consider combining the two. Or encourage your client to put some more money into the due diligence when possible.
Depending on where your clients are in their price range, being beaten out time and time again by cash-flush investors can be infuriating. However, there are a handful of companies that can turn your finance offer into cash-like magic. Ribbon is an excellent example. For a fee (of course), they will turn your pre-approved financed buyer into a cash buyer. Some processes must happen, however, if you meet the qualifications, it can be upfront and easy.
There are plenty of contingencies that come up in the 15 pages (in NC) that is our offer. Inspections, appraisals, previous homes sales, due diligence dates, closing dates, and more all fill the pages. There are plenty of opportunities for you and your buyer to make the transaction easier. The first thing that can strengthen your offer is to waive the appraisal contingency. If your clients are comfortable with their valuation and purchase price, waiving the contingency can be done in most cases by putting a hefty downpayment on the home. Ask the lender about all of the requirements for an appraisal waiver.
The second-largest contingency is an inspection. Many risks could happen when waiving any contingency, especially the inspection. In most cases, if the home is in decent condition, items noted by the inspector will be minimal. Have a conversation with your client about all of the risks. But, if the home is in excellent condition, your clients might be comfortable waiving the home inspection. Since this is typically one of the most strenuous parts of due diligence, waiving this contingency is beneficial in making sure your offer is chosen first.
Being flexible towards your closing date is another excellent way to stand out. Many are on a different timeline due to the sale of their current home, or the purchase of their next. If you can be a little flexible and assist their schedule, you will stand out. In addition, shorten your due diligence period. If you are doing inspections and appraisals quickly - or even waive one of both - consider shortening the due diligence. If sellers see in your offer that you are willing to give them their second earnest money deposit soon and get out of the pressure of due diligence, this will once again strengthen your offer.
We have talked throughout this article about all of the things that you can do to make your clients' offers stand out. All of these are fantastic options and are important to consider. However, you need to have an upfront conversation with your client about their boundaries and what they are comfortable with. It is a seller's market, however, that does not mean that they control every single decision that we make. Things are moving quickly, but buyers still need to have control of the situation and the offer.
Be the first to submit.
Sometimes the easiest way to stand out is to be the first offer they get. Get some help with transaction coordinators as we have in our solutions team for each office. Writing offers can be quick and you can submit before anyone else.
Talk to the listing agent.
The listing agent will have plenty of information that they probably should not tell you about what their sellers prioritize in an offer. You can custom tailor an offer that will fit their needs perfectly.
Quickly summarize the offer in your email.
When you send an offer over, quickly summarize the offer so that the listing agent does not have to sort through all of the paperwork multiple times. They can call their client quickly and outline the offer instead of waiting hours and then talking to them.
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