Different real estate markets have different rules for success. In some markets, just putting in an offer wins the deal. Other markets, a bid of ten thousand above list price will not win the home.
Understanding the current market is crucial to making a successful offer.
Discuss with your real estate the offer amount you have in mind, based on the research you have done on comparables, the condition of the home and its components based on the inspection, and what items may or may not be included in the sale.
Your real estate professional will help you fill out the paperwork to make the offer official. Your agent will present the offer to the seller’s agent, who will take it to the seller. The owner can accept the offer as is, reject the offer or make a counter offer. A counter offer amends either the price or the contract stipulations, such as inclusions, earnest money amount, contingencies, or time schedules such as closing dates, possession dates, etc. Any change to the original contract proffered by the buyer is considered a counter offer.
Once you are dealing with a counter offer, you are in the negotiation process. You can now accept, reject or amend the seller’s counter offer. It is not unusual for offers to go back and forth between the buyer and seller several times before compromises are made or the deal fails. The offer does not become a contract until all items and stipulations are agreed upon and both parties sign.
Contingencies are conditions that must be met for the contract to be executed. In real estate, contingencies may address appraisals, loan approval, and home inspections for termites, radon, lead-based paints along with many other possibilities. Contingencies sometimes include the sale of the buyer’s current home as well, which won’t apply to you as a first-time home buyer.
Negotiations are a big part of the back and forth counter offers and building the case for an offer to be accepted by the seller. Dan Parisi, northern California Coffee Real Estate agent, negotiates to win the acceptance of an offer for his clients. Constructing a strong case for his client, be it a first time home owner or a seasoned investor is a prime motivator for him when preparing an offer to buy real estate.