In the last 8-9 months or so the real estate market was a lot different here in the Twin Cities.
In fact, for the first time in about two years, the market was slowing down, we were gaining some much-needed inventory, and I let out a deep sigh of relief.
The ultra-competitive pandemic market was one like no other and made history in a multitude of ways.
Fast forward to several months later and the market has yet again shifted in real-time here in the Twin Cities.
Ultimately, the market picked back up in late February 2023, which was to be expected as we entered into Spring here in the Twin Cities. But, our inventory levels are still quite low, and in turn, the competition is fairly high. Not as intense as it was during the pandemic, but we are still seeing homes going into multiple offers in a matter of a day or two, appraisal gap coverages being offered, inspections being waived, etc.
So what’s a home buyer to do when shopping in a competitive market? Here are some of my go-to strategies to help folks get their offers accepted.
1.) Have reputable and hard-working people on your side. Having a fantastic realtor and a local, reputable lender is going to put you miles ahead of other folks that are out shopping.
- What makes a good real estate agent? Someone who is ultra-responsive and always has your best interests in mind, and someone who is a full-time REALTOR®. Your real estate agent should be a great listener, should help ease anxieties, and should provide you with all the information you need to make the most informed decisions. A good REALTOR® should also think creatively and attempt to foster a connection with the listing agent. Sometimes just asking a few questions about the sellers and their needs goes a long way!
- What makes a good lender? In my opinion, a good lender is a loan officer that is local, ultra-responsive, and that comes pre-vetted by your REALTOR®, family member, or friend. Working with a reputable lender is something I am extremely passionate about. A lender should never talk down to you, should hold space for all your questions, and should be able to clearly explain the mortgage process. A bad or lackluster lender can affect your experience and the strength of your offer!
2.) Set realistic expectations from the start. It might take you longer than you planned to find “the one.” I talk to people about their overall timeline before we even look at homes so we can walk through different situations that might unfold. The more flexible you can be with your timeline the better, and typically less stressful it will be for you. However, I know it isn’t always that easy and sometimes you just have to move asap.
3.) Plan to shop under budget. How much you shop under budget will most likely be determined by your overall price point, but generally shopping $25k-$50k under budget is a great starting point.
4.) Get creative with your offer! This will be completely situational, but talking with your real estate agent to discuss different strategies and options is going to be a key component to your offer getting accepted. In 2022, I (surprisingly) only had one set of clients forgo a home inspection, and the rest were able to have an inspection period! We would often write verbiage into their offers that said they would assume $X amount in inspection findings. Essentially, we would be moving forward through the inspection period right away, unless there were huge issues that totaled over $X amount. Things like assuming minor inspection repairs, allocating funds to cover appraisal gaps, paying your closing costs, offering the seller a rent-back, and increasing your earnest money amount are all examples of ways to help strengthen your offer.
5.) Don’t settle and stay the course. It can get discouraging when you’re trying to buy a home in a competitive market, especially if you have lost out on a home or two. My advice is to refocus and don’t lose sight of what you are looking for in a home. It’s easy to want to settle if you are feeling the heat of the market!
If you ever have any questions about the current market I’m just an email away. Cheers!