With record low inventory, the Boise, Idaho, real estate market shows no signs of slowing down. This means it’s important now more than ever to find ways to “win” the home you want in this hot market.
When my buyer clients are discouraged by the lack of inventory or “bidding-war” hearsay, I tell them this: Your Boise dream home is out there, and there are ways to gain an edge when there are multiple interested parties. Multiple factors play into a seller’s motivation when they choose a buyer out of multiple options. Obviously the price you offer is key, but being confident, effective communication and creative elements in your offer can make all the difference. For example, waiving an appraisal and conducting an inspection for informational purposes only can make your offer more attractive. Keep reading for more information on each of these tactics.
# 1 – Confidence
During your home search, we might pull up to a house with multiple groups of buyers waiting to get in to see it. This doesn’t always mean you’re going to enter into a bidding war or multiple offer situation. It’s important to project confidence, even if you’re worried about getting your hopes up.
When it comes to Boise home values, it’s important to do some soul searching. Ultimately, the value is based on what the home is worth to you, and what you or another buyer is willing to pay for it. If there are competing offers on a home, you’re likely going to be offering over the asking price. You won’t know what the other party is offering, so you’ll have to decide how much you’re willing to spend on the house when you craft the offer and determine the why behind the worth.
Is the house next door to your parents? Then it might be priceless. Does the house have flaws that detract from its value? You might not be willing to go much over asking, if at all. The home might also be improperly priced to begin with, such as by being below market value to encourage a bidding war. When reviewing your home-buying wish list, it’s important to ask how much each element is worth to you, and how that will change or stay the same over time.
When I work with buyers, we are constantly communicating and strategizing. This hot market moves fast, and part of my communication practice is to stay in touch with both my buyers and the seller’s agents of homes they’re interested in. Making sure we know what’s important to the seller is key, and finding out their priorities can make the deal. For instance, maybe the seller hasn’t found their new home yet and needs more time after closing. Maybe they need a rent-back while their new home is being built or prepared.
The opposite can happen, as well. When you begin your home search, think of a timeline to move that will work for you, but prepare to be flexible. If you craft an offer for a vacant home, the seller might want to close quickly. They also might want to wait until they’ve owned the home for two years for tax savings. We will want to find out when offers are being presented and what terms are important to the Seller. Good, regular communication gives my clients an edge. Plus, ensure you’re pre-approved and working with a good lender who can make quick closings happen if that’s what’s needed.
# 3 Creativity
While offering the right price is important to successful real estate transactions, the key to this competitive market is creativity. The price is just one piece of the puzzle. The other pieces include the earnest money, closing date, inspection, appraisal and more. All of these elements add up to crafting the perfect offer, and the finished puzzle looks different for every home. Let’s go into each of them.
An important part of any real estate transaction, the amount you set for earnest money tells a seller how interested you are. A standard earnest money deposit in the Treasure Valley is approximately 1% of the sale price. To beat out other offers, you can offer more, especially if you’re providing more than 20% as a down payment. Once you have an agreement with the seller, the earnest money is deposited to your Realtor’s broker for holding in escrow. However, you can also request that the broker release this money to the seller after the contingencies have been met.
Waiving the Appraisal
If you’re putting more than 20% down or you have healthy cash reserves, you can offer to waive the appraisal. This shows you’re confident in the price you’re offering. If the appraisal comes in low, just beware that you’ll have to make up the difference between the appraisal value and loan amount. In my experience, it’s rare to have a home come in low on the appraisal. If it does, you might just need to rearrange your down payment a bit. When you have good credit and are putting 20% down or more, a bank might also offer to waive the appraisal.
If you don’t think the inspection will be an issue, you can offer to conduct your home inspection for informational purposes only. If something comes up in the inspection, you can terminate the deal based on an unsatisfactory inspection. A first-time home buyer with limited funds might be uncomfortable with this approach. Just remember, in Idaho, it’s not the seller’s responsibility to bring the home up to code or your standards. Any items of repair are negotiable, and there’s no expectation that everything will be fixed.
While the Boise real estate market’s hot streak isn’t new, when you find a house you want, things happen fast. This means it’s best to know where you stand on all of the above before you even craft your offer.
Of course, it pays to have a confident negotiator on your side. In this hot market in particular, I view myself as an experienced guide. We’ll discuss openly what it takes to be the buyer that stands out as a “win win” for the seller. I have decades of experience in real estate negotiations. Plus, I’ve helped hundreds of people purchase homes in the Treasure Valley. When you’re ready, give me a call or shoot me an email at firstname.lastname@example.org.