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Ready to Buy? Expert Advice on Writing an Offer for a Home

Written by Posted On Wednesday, 26 August 2015 14:54

Looking for a home can be an overwhelming experience, especially for first-time buyers. Once you find the perfect home, you can be quite eager for the entire process to end. Unfortunately, finding the home you love is only part of the battle. The next step is the hardest part of the process—you'll have to make an offer on the home. While this can be the toughest part of the whole ordeal, it doesn't have to be the worst if you plan in advance and know how to write an acceptable offer which will appeal to the seller.

Know the Market

You should know the market before making an offer on a home. Don't rely on your agent to find you homes in your price range while also knowing the comparable sales in the area. A knowledgeable home buyer will know to ask about the selling price of other comparable homes in the area. A comparable home is one that has been sold in the area that was in a similar condition, approximately the same square footage and has a similar lot size. It's important to ask your agent to find that information before making an offer on the home.

Make an Offer

Before making an offer, understand whether you're in a buyer's or seller's market. That will influence whether the seller is open to a lower price than what they are asking for the home. In a buyer's market, there will be many homes out there for sale, which makes it harder for sellers to receive asking price for their home. You won't know what others are offering for the home, so consider this step very carefully. Prepare to make your offer by ordering checks online beforehand, so you're ready to write the offer as soon as you've evaluated the market. Additionally, prepare for your offer by assessing the seller’s attitude. If you go in too low, you could offend the seller, who may decide not to entertain any more offers from you. A low offer could include quick closing, large deposit or a pass on necessary repairs. You might decide to pay the asking price, but with some conditions, based on repairs being made before closing. If you really love the home, don't be afraid to offer the full price for it.

Handling Counteroffers

When making an offer below the asking price, many homeowners will send back a counteroffer. It will be above your initial offer but might be below their original asking price. When negotiating, figure out what is the highest and best offer you'll make for the home. Stick to that amount no matter how many times you and the homeowner make counteroffers. In the heat of negotiations, it's easy to lose sight of the upper limits of your price. In some cases, you might be in a bidding war with other buyers. You won't know how much they are offering, or how motivated they are to buy that home. Take that into consideration when making your offers. Take stock of your desire for the home before engaging in a bidding war.

Best Offer

During the negotiations, the seller might ask you or your agent what the best offer you can make is. Many homeowners find negotiations stressful and want to get to the bottom line quickly. This is another reason you want to figure out the highest amount you'll pay for the home based on your interest, the comparable prices in the neighborhood and what you think the home is worth. When a homeowner asks for a best offer, that's the end of the negotiations. They will either accept or decline the best and highest offer you can make. You should know that before naming the price you are willing to pay.

It's both extremely stressful and incredibly rewarding to bid for and win the home of your dreams. You'll need to do some research before beginning to write your offer, but if you understand the basics of researching comparable homes, negotiating for the home and writing an offer, you'll find the process much easier and more straightforward.

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Emma Sturgis

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