Our nation is in the midst of a shifting real estate market. But even as the buying frenzy begins to slow, many properties are still receiving multiple offers.[1] So what’s the best way to compete as a buyer–especially if you’re wary about overpaying?

While a high offer price gets attention, most sellers consider a variety of factors when evaluating an offer. With that in mind, here are five tactics you can utilize to sweeten your proposal and outshine your competition.

We can help you weigh the risks and benefits of each tactic and craft a compelling offer designed to get you your dream home—without giving away the farm.

1.  Demonstrate Solid Financing

Sellers favour offers with a high probability of closing. The most important step you can take as a buyer is to get preapproved before you start looking for homes. A preapproval letter shows sellers that you are serious about buying and that you will be able to make good on your offer.[2]

It’s also important to consider the reputation of your lender. While sellers may not know or care about a lender’s reputation, their agents often do. If you’re unsure who to choose, we are happy to refer you to reputable lenders known for their ease of doing business.

2.  Put Down a Sizeable Deposit

Buyers can show sellers that they have “skin in the game” by putting down a large deposit. The deposit is typically held in a trust account by the seller’s brokerage or lawyer.[3] If the purchase goes through, it is applied to the buyer’s down payment. However, if the sale falls through, the buyer could lose some or all of their deposit, depending on the contract terms. We can help you determine an appropriate deposit to offer based on your circumstances.

3.  Ask for Few (or No) Conditions

Conditions enable a buyer to cancel the purchase agreement if certain requirements are not met. Buyers in a competitive market often volunteer to waive certain conditions. However, it’s very important to recognize the risks of doing so. For example, a buyer who chooses to waive an inspection condition may find out too late that the home requires extensive renovations. If you back out of a purchase without the protection of a condition, you could lose your deposit.[4] We can help you assess the risks and benefits involved.

4. Offer a Flexible Closing Date

When it comes to selling a house, money isn’t everything. People sell their homes for a wide variety of reasons, and flexible terms can sometimes make all the difference. For example, if a seller is in the process of planning a significant move, they may appreciate an option to advance or postpone their closing date. We can reach out to the listing agent to find out the seller’s preferred terms and then collaborate with you to write a compelling offer that works for both parties.

5. Work With a Skilled Buyer’s Agent

In today’s market, one of the greatest advantages you can give yourself is to work with a skilled real estate professional. We will help you submit an appealing offer without taking on too much risk. Once your offer is accepted, we’ll also handle any further negotiations and coordinate all the paperwork and other details involved in your home purchase. The best part is, you’ll have a knowledgeable, licensed advocate on your side who is watching out for your best interests every step of the way.

Helping You Get to the Right Offer

In many cases, a competitive offer doesn’t need to be condition-free or significantly above asking price. But if you’re buying a home in today’s market, it’s important to consider what you can do to sweeten the deal. And if you’re a seller, we can help you evaluate offers by taking all the relevant factors into account. Contact us today to schedule a free consultation.

Sources:

1.    Bloomberg

2.    NerdWallet

3.    Nesto

4.    Loans Canada