There is no denying Metro Denver is in the midst of a hot-hot-hot Seller’s Market. So where does that leave you if you want or need to buy a home right now or in the near future? A Seller’s Market is defined by a number of houses for sale that is less than the pool of available Buyers: low inventory of any commodity + high demand = seller’s market, whether the commodity is houses or cars or apples.
As a Buyer in this marketplace, there are ways to prepare for the best transaction possible, and to give yourself a bit of an edge in a market that favors the Seller over the Buyer in most cases.
- QUACK! QUACK! Get your financial ducks in a row. In a Seller’s Market, it is not only advisable that you be prequalified for a home purchase – it is imperative. Sellers have every expectation of significant interest in their home, and possibly even multiple offers. They will not be impressed with an offer that is missing the all important prequalification letter. If you are serious about buying a home, come prepared to play ball – not play around.
- Hire an experienced Realtor. You probably wouldn’t hire the teenage neighbor boy to detail your Porsche. Don’t hire an inexperienced agent to help you purchase a home. You deserve excellent representation, and in a Seller’s Market, you will need the help of a keen professional to negotiate on your behalf. Ask your potential agent questions about his or her track record, how many transactions they closed last year, how long they’ve been in the business. Ask them to tell you about the most challenging deal they’ve closed, and how their efforts contributed to a successful outcome.
- Prioritize your home search. You don’t have to take a month off of work to find your next home, but you may need to take a long weekend. And you definitely need to keep your showing appointments and be prepared to seriously consider each home you look at. You likely have competition in the form of other Buyers for every single home you see, and once you find “the one,” you need to be ready to jump. Searching online beforehand and narrowing down a top 5 list of features you can’t live without (location, number of beds/baths, square footage, yard size, etc.) is a must.
- Decide which contingencies are a must before you shop. Everything in Real Estate is negotiable, but there are some aspects of the deal you may not be flexible on, such as the home inspection. I would rarely recommend that a home be purchased without a thorough inspection – even in a Seller’s Market. One example of a contingency that may be challenging in a Seller’s Market is a Sale Contingency, wherein you require a Seller to stay on the line while you wait for your current home to sell. A strong offer (full price or over the asking price) may convince a Seller to accept a contract of this nature, but when a Seller has other Buyers on the line, they will likely not tolerate the extra risk of waiting for your home to sell.
- Flexibility matters in all market conditions. Whether Sellers or Buyers are at the top of the heap in your marketplace, your transaction will go more smoothly if you are prepared for friendly flexibility along the way. Contract negotiations may be tense. Dates and details change. Inspections sometimes uncover surprises. Waiting for the appraisal to come in can be stressful. You hired an experienced Realtor to advocate on your behalf for a reason. Resolve to be patient, ask lots of questions, and don’t panic.
Are you considering a Metro Denver home purchase, or in need of a referral to a qualified agent out of state? Drop me a line. I’ve been helping Buyers and Sellers navigate the marketplace for 21 years, and I’d love to assist you in your next Real Estate transaction.
The Meyers Group