The current housing market in Greater Phoenix demands a more strategic approach to buying and selling homes than we have seen in many years. The R.O.I. Properties team has launched our new blog series, Excelling in the Residential Market, as a way to help both homebuyers and home sellers to navigate the process for maximum success and with minimum hassles. To be alerted when new articles come out, make sure to like R.O.I. Properties on Facebook.
In the previous article, we discussed some of the strategies to persuade sellers based on their emotional sensibilities. Now, let’s talk about what will make even more difference in executing a deal: money!
3 Financial Factors that Can Make You a More Attractive Buyer
In residential real estate, you generally hear the term pre-qualifying in terms of a mortgage lender and how much you are allowed to borrow. In this highly competitive market, the concept of pre-qualifying has another important definition that is relevant to the seller: Is this buyer going to perform? Here are three financially oriented steps you can take to prove you can and will make good on a deal:
- Address appraised value/appraisal contingencies up front. Properties are selling above recent comparable sales, which is what appraisers use to value properties. Appraisers generally do not take a forward look, merely a historical look at property values. Property values are rising at this time, but comparable sales are trailing market activity. If you can address appraisal issues by either waiving the appraisal, or indicating that you will “close the gap” on the appraised value and contract price, you will have a higher success rate.
- Increase your down payment, if possible. Financing contingencies are what is holding sales up these days. If you have cash available, you may want to provide for financing less of the transaction. This will allow a seller to feel more confident in you, as a buyer, and your ability to perform.
- Provide proof of funds. Providing a statement that indicates you have enough money to cover your proposed down payment, and submitting this with your offer, may differentiate your ability to perform, from the seller’s perspective. This could be a statement from your bank (removing all but the last four digits of your account number), or a letter from your bank or investment firm.
In an upcoming blog post, we will be offering an exclusive interview with a Greater Phoenix appraiser—including insights for sellers on how to maximize their price—so keep an eye on this page!
Read previous articles in the Excelling in the Residential Market series:
- Ways to Position Yourself as the Most Attractive Buyer, Part 1
- Tight Housing Markets Require Focus and Strategy
Sellers hold the cards in today’s market—so a strategic plan is essential for buyers who want to secure a good deal at the right price. Contact R.O.I. Properties at [email protected] or 602-319-1326.