Right now, our Palm Springs market is seeing a lot of competition among buyers. Today, I’d like to offer some tips on how to win in bidding wars.
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As the housing market heats up here in our Greater Palm Springs area, homes priced under $700,000 have an absorption rate of 5.4 months. As a reminder, any absorption rate below six months equates to a seller’s market.
Since our market is currently trending in favor of sellers, it’s important that buyers prepare for the possibility of entering a bidding war during their home search. With that in mind, I’ve got four strategies to help you succeed against the competition and win out in bidding wars.
1. Understand how much home you can afford. Buying a home makes for a very emotional purchase. If you don’t know what your limit is, you could be suckered into buying more than you can afford. Your lender or financial advisor will be able to help you determine what your limits are.
2. Put your best foot forward early. If your first offer is one of several, you may not get the chance to improve it. In this scenario, let your first offer be your best. If it isn’t, you could be losing out on the home of your dreams.
3. Have your agent talk to the listing agent. This will help you better understand the motivations, wants, and needs of the seller. That way, you can better meet their terms. Proposing a shorter time frame, for example, may swing the deal in your favor.
4. Propose an as-is sale. The fewer conditions you put on the purchase of the property, the better the deal is for the seller. If you aren’t comfortable with an as-is sale, perhaps decrease the length of your due diligence period. You may also offer to pay for things that would customarily be paid for by the seller. Another option is to remove the appraisal or loan contingency.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.