If you have been hiding under a rock for the last 3 years you may not have noticed how hot the Real Estate market is here in the Denver Metro area. For everyone else especially those trying to purchase a home we are all too aware that this is indeed one of the hottest Real Estate markets in the country. What makes this market so “hot” is that there aren’t enough inventories to support the growing demand for homes here in Denver. In other words there are more people looking to buy a house than there are homes available for purchase.
We call this type of Real Estate market a “seller’s market” because the seller has what so many buyer’s want; a home. The negotiating power is very much in the seller’s corner. So buyers and their agents have begun to get pretty creative when submitting their offers. Here are a few of the tactics we have seen over the last few years:
Offering over the list price “Love Letters”-They may seem cheesy but Real Estate agents will tell you that they work. This is where the buyer is submitting an offer with a letter telling the sellers about their family and life situations to try and sway their decision Escalation Clause-Buyer’s are submitting their offers with a clause that states if there is another offer they will automatically bid $1000 or $2000 or however much they choose over that higher offer price. This just about insures that they win the offer but they need to make sure that they are financially able to cover the additional cost and the appraisal may not come in that high.
Waiving the Inspection and/or Inspection objection deadlines and purchasing the home as is No appraisal or waiving the appraisal condition and deadlines and agreeing to cover any difference in the appraised value and agreed upon purchase price. Short closing times-Buyer’s will work with a lender, typically a smaller local lender that can close quickly to accommodate a seller’s need to sell fast.
Related Article: Using Online and Mobile Search Tools with Your Real Agent
Cash offers-“Cash is King” and seller’s love cash offers from buyer’s if they can do it
We work with agents that have received over 40 offers for a home and some pretty interesting bonuses to try to win the hearts of sellers. The key in a market like this is to keep grounded and remember that you are making the biggest purchase of your life. Make sure that what you are offering is realistic and that your team (realtor and lender) are in agreement with your offer.
Make sure it feels right before you make any offers over and above a listing price.
Check out a recent radio show on this subject Saturday July 23rd at 11am on AM1690 with David Hosterman and Joe Massey on the Mile High Mortgage and Real Estate report. The show includes guest Real Estate agent Olivia Kunivicius.
Article Written by:
David J Hosterman
Branch Manager | NMLS# 220562
O: 303-501-1401 C: 720-260-9814 F: 855-258-3182
E: [email protected]
7400 E. Orchard Rd Suite 2900N | Greenwood Village, CO 80111
Jonathan A Edwards
Licensed LO Assistant | NMLS# 671258
O: 303-405-2725 C: 303-921-5747 F: 855-258-3182
E: [email protected]
7400 E Orchard Rd Suite 2900N | Greenwood Village, CO 80111