You’ve found your dream home, in just the right location, or the deal investment property, but the selling agent has just dropped a bombshell…
“We have several other interested parties!”
“We’ve already had a number of offers…”
Suddenly the lifestyle you were picturing, with your family enjoying this amazing property, could be snatched out from under your nose.
Or maybe that investment property that will be part of your road to financial freedom will pave someone else's way.
So how can you make your offer more attractive, and ensure it stands out from any other potential buyers and investors who are scheming make it their own?
Here are a few tips to get the upper hand…
Making an offer of an unusual amount (think increments of $500, $1,000 or $2,000 rather than the usual $5,000) can help you secure a property.
While this amount won’t be noticeable over the life of your mortgage, it could be the clincher that seals the deal for you when buying through private treaty.
The other prospective buyers will likely offer a rounded sum, but a seller motivated by achieving the highest possible price will naturally gravitate toward the larger offer, even if it’s just a few hundred dollars.
Consider it this way: if someone else offers $800,000, and you offer $801,500, who is the vendor likely to choose?
The vendor may be in a hurry to sell, for personal or financial reasons, but at the same time stressed out about where they’ll live once the sale is complete.
By offering to rent the property back to them for six months or so, while they figure out their future plans, you’ll stand out from the crowd as a sympathetic buyer who has compassion for their situation.
That little bit of extra time to gather themselves could be priceless to the seller, so check with their agent if this is something they would be interested in and consider including it in your offer.
Alternatively, if the sellers are keen to move on, you could beat out other potential buyers by offering to settle in the shortest possible time-frame.
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Again, discuss this with the agent, as they will be familiar with the sellers’ circumstances and know if they are hoping for a shorter settlement.
If the vendor is waiting on the sale to finalise their new property, offering a fast settlement could make your offer more appealing.
Is there a large outdoor dining setting on the deck, which the vendor can’t be bothered moving to their new place? Or a cubby house that their children have grown out of, which would be a pain to relocate?
Perhaps offer to purchase it as part of the sale, and bump your offer up to reflect this.
If the seller is motivated by convenience, this type of inclusion could seal the deal, as it earns them a few extra dollars and saves the hassle of removing the item.
Ask the agent if there’s room to negotiate such an inclusion in the contract.
Most offers are “subject to” certain conditions being met – this can include the buyer securing finance, satisfactory building or pest inspections, or the sale of your current home.
There are also cooling off periods, which vary by state, that apply to the purchase of residential properties.
By offering to waive one or more of these conditions, you could expedite the buying process and may sway the seller towards accepting your offer over another of the same amount.
Of course, be sure to get expert advice before offering to waive any conditions, as an unconditional contract can be very risky.
Knowing exactly how much you can afford means you can make an offer with confidence.
So go through the pre-approval process with your bank or a broker, so you are armed and ready to lock down that dream home.
You should also make sure you can access the funds for your deposit, which will be payable if your offer is accepted.
With your deposit ready to hand over and your pre-approval sorted, you’ll be a step ahead of other buyers and with any luck, you’ll be signing a contract in record speed!