Strategies for a Winning Offer

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Dear Sue,

I am so frustrated!

I am a first time (trying to be) buyer. Believe it or not I am in my second year of looking and making offers for homes that are ultimately bid right out of my price range.

It’s not that I am wasting any time. I signed up on one of those listing notification sites. I sometimes know about the new listings before my agent does.

I have been pre-approved and my down payment is in the bank.

In spite of everything it looks like I will miss out on the $8000.00 federal tax credit which I understand is due to expire at the end of November. I don’t seem to stand a chance. Any ideas?

Disappointed Dan

Dear Dan,

Properties listed in Placer County below the $300,000.00 price point are flying off the shelf! Other first time homebuyers looking for the tax credit, as well as investors who think that the market has hit bottom are jumping on every new listing in this price range.

Before making any offers I would suggest that you have your agent pull the most recent comparable sales. The most important statistic to analyze is the percentage of list price to sale price. If a $100,000.00 property sold for $105,000.00, the percentage would be 105%. If the sale price on a $100,000.00 asking price was $100,000.00, the percentage would be 100%.

My suggestion would be to offer approximately 1% above the average. i.e. the sales comparables indicate that the properties are actually closing escrow 5% above the asking price. Try offering 6% above the asking price.

I would also suggest that you keep your offer as clean and straight forward as possible. If the property appears to be in good condition make your offer “as-is” subject to your inspections and independent investigations.

If during your inspection period you find a defect that you just can’t live and the seller is unwilling to correct, you will not be contractually obligated to close the escrow. Many people believe that “as-is” means that you are obligated to go through with the sale no matter what turns up during the inspection period. Not true!

These strategies could be a matter of good home $$’s and Sense