I beat out offers that were $20,000 higher than what I had offered in a highly competitive market. How did I do this?
I found a place for myself that was everything I have been dreaming of in a home in Chicago. It has outdoor space, a private entrance, carrara marble in the kitchen, and walking distance to the 606. It even had things I didn't know I wanted like garage parking next to my door, 10' windows and high ceilings. I found it on Top Agent network and they had multiple offers within hours of it being listed off market. (note - make sure if you are buying a place with an agent that isn't me you ask them how they find off market properties)
Now, I knew that it was going to be hard to beat out other offers. I spoke with the agent I had found out they hadn't found their next home yet and in this market I know that could be a very stressful thing for the sellers. No one wants the stress of a 30 - 60 day close on the home they are selling if they don't know where they are going.
So, I wrote the offer with a blank in the close date and told them that they can just let me know when they find a place to buy. I knew they were anxious to move by the beginning of the school year so I wasn't worried about it taking too long. This gave them 4 months to find a new house.
I also told them that while I wanted to get an inspection I wouldn't be asking for any credits. Typically things that come up in inspection are minor things and in a competitive market like this it is best to offer a price where you feel comfortable doing a little work. Removing your expectations that a house be in perfect move in shape is key.
IMPORTANT - don't sign AS-IS in the contract. If something huge did come up in inspection like a structural issue I wouldn't have been able to back out of the deal without my earnest money being at risk. I just promised in my offer email that I wouldn't ask for credits.
CASH OR REMOVE APPRAISAL CONTINGENCIES
Anytime you can make a cash offer it changes things. The sellers number 1 fear is that you will not be able to get financing. If you have a cash offer close to a financing offer typically the cash offer will always win.
Yet, the other thing you can do is remove the appraisal contingency. This you can only do if you have cash to pay the difference between what the property appraises for and what the contract is for if the appraisal comes up short. In a hot market like we are in there is always a fear for the seller that the appraisal will come in low. If this happens and the buyer doesn't have the money to cover the difference between the appraisal and the offer price the deal will fall apart unless the seller lowers their price.
The comparative properties for this property where a tad lower than what I offered. It was going to be hard for the person to get financing that offered 20k more than I did. So even if it looked like a lot of money the probability of that buyer being able to get financing was slim.
I made my offer as sure of a deal as I could.